Amanda Staveley loses high court action against Barclays

Amanda Staveley loses high court action against Barclays
Added 2 months ago
Summary: High-profile financier sought £660m damages saying bank bosses misled her as she helped secure deal to save bank in 2008
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Businesswoman Amanda Staveley has lost a multi-million pound high court battle against Barclays despite the judge finding that the bank was “guilty of serious deceit” in the way it raised billions of emergency funding to avoid a UK government bailout during the financial crisis.

Staveley had sued the bank after learning that it had offered her client Sheikh Mansour bin Zayed Al Nahyan of Abu Dhabi, a worse deal than that it offered to Qatar when Barclays was seeking billions of fresh investment to keep it going during the 2008 banking crisis.

Staveley’s private equity firm PCP Capital had claimed £830m in damages.

Judge David Waksman ruled on Friday that “Barclays was guilty of fraudulent misrepresentation” but that Staveley’s PCP group was not entitled to damages. This was because even if Barclays had been honest, PCP would not have been able to raise enough money to finance the deal, he said.

“While PCP has succeeded on liability, it has failed on causation and loss with the result that the overall claim fails,” Waksman said. “I can understand why this outcome will be a serious disappointment to PCP, especially after I have found Barclays to be guilty of serious deceit.”

The judge described Staveley as “the driving force of PCP” and a “tough, clever and creative entrepreneur”. He dismissed Barclays claims that she was “guilty of ‘obvious embellishment and invention’.”

“I do not accept that as a general characterisation… she was essentially an untruthful or unreliable witness,” Waksman said. “I thought that, for the most part, her evidence was reliable.”

Staveley, who the court heard had been referred to by some bank executives as “dolly bird”, said she was considering an appeal.

“In spite of Barclays’ efforts to question my character and credentials, the court has recognised my abilities as a businesswoman and the truth of my account of events,” she said after the verdict. “The judgment confirms what I have said from the outset and repeated in my evidence; a senior executive at Barclays repeatedly lied to me when seeking private investment in the bank during the 2008 financial crisis.”

“The evidence at trial was clear and unequivocal; [her private equity firm PCP Capital] was an investor in the transaction and played an integral role in the capital raising, which ultimately prevented the bank from being nationalised.

“I will be taking advice on appealing the judge’s decision not to award damages.”

Her lawyer said he hoped “regulators will have a close look at this judgment and the conclusions the judge reaches on the behaviour of senior personnel within Barclays”.

A Barclays spokesperson said: “We welcome the court’s decision to dismiss PCP’s claim in its entirety and award it no damages.”

Waksman criticised senior Barclays executives for their behaviour in negotiating the deal. He said Roger Jenkins, who was head of Barclays’ Middle East operations and led the discussions with PCP, was “prepared to be dishonest” and said parts of his evidence to the court were “clearly unsatisfactory and implausible”.

“In my judgment, Mr Jenkins knew perfectly well that PCP was not getting the same deal in the required sense,” Waksman said. Jenkins was one Britain’s best-paid bankers during the financial crisis and received a £50m pay-off in 2009 in addition to his £39m annual pay and bonuses.

The judge also said John Varley, Barclays former chief executive, was “evasive” in his evidence.

Barclays, one of the few British banks to avoid a bailout in 2008, escaped criminal charges over the 2008 fundraising in 2018 and three former executives – including Jenkins – were cleared of fraud last year in a case brought by the Serious Fraud Office.

PCP, which led Abu Dhabi’s £3.25bn investment into the bank, alleged that Barclays paid Qatar £346m in hidden fees to secure its invest in the bank.

Barclays denied the allegations and said it had struck separate, commercial agreements with Qatar and that PCP’s case was “wrong at every stage”.