BCS Barclays PLC

By Margot Patrick and Max Colchester 

LONDON -- Britain's financial regulator has reopened a probe into how Barclays PLC persuaded Qatar's sovereign-wealth fund to bail out the bank during the 2008 financial crisis, just as a separate investigation of that matter by the Serious Fraud Office nears resolution.

The Financial Conduct Authority recently conducted a fresh round of interviews in the case and is studying new evidence, a person familiar with the matter said Thursday.

The case is one of the last remaining financial crisis-era probes in the U.K.

In 2013, the FCA fined Barclays GBP50 million (about $79.4 million at the time) over advisory services agreements it struck with Qatar Holding LLC as it pumped money into the bank in 2008. Barclays didn't fully disclose to shareholders at the time that it agreed to pay the Qatari group GBP322 million over five years, potentially breaking disclosure rules. The FCA also alleged the primary purpose of the GBP322 million payment was to get Qatar to buy Barclays shares.

But the case remains on hold while the SFO has carried out its own investigation into the bank and several individuals. Barclays contests both the allegations and the fine.

The Financial Times reported earlier Thursday that the FCA had reopened its case.

The head of the SFO, David Green, told The Wall Street Journal on Tuesday that it would decide soon whether to file charges against Barclays and former top executives over their handling of a GBP7.3 billion ($9 billion) capital injection primarily from Middle Eastern investors. The SFO has said it would aim to make a decision on any charges by the end of the month.

The long-running review picked up speed last year when Barclays released thousands of emails and documents that it previously had said were protected by attorney-client confidentiality.

Several former Barclays executives have been questioned by the SFO, according to people familiar with the matter. The fraud office must now decide whether to press charges against the individuals involved, the bank or both.

The U.S. Department of Justice and Securities and Exchange Commission also are investigating the agreements, Barclays has disclosed in regulatory filings.

While other U.K. banks including Royal Bank of Scotland Group PLC and Lloyds Banking Group PLC tapped taxpayers for bailouts, Barclays raised funds privately during the financial crisis. Any public sanction could shine further light on how Barclays executives got Middle Eastern investors to prop it up during a period of intense market turbulence.

All of the executives and board members at the bank during this capital-raising have since left.

Barclays also is fending off a GBP721 million lawsuit by PCP Capital Partners LLP, a company run by London-based financier Amanda Staveley, related to the bank's financial crisis fundraising.

The suit alleges the advisory agreements Barclays struck with Qatar Holding were a sham and gave the wealth fund more favorable treatment than Abu Dhabi investors who also invested and whom Ms. Staveley helped bring into the fundraising. Barclays disputes the allegations. In February, a U.K. judge ordered Barclays to hand over emails related to the capital raise.

Write to Margot Patrick at margot.patrick@wsj.com and Max Colchester at max.colchester@wsj.com

(END) Dow Jones Newswires

March 23, 2017 14:45 ET (18:45 GMT)

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