BCS Barclays PLC

By Anna Isaac, David Benoit and Simon Clark 

U.K. investigators are examining visits by Barclays PLC Chief Executive Jes Staley to Jeffrey Epstein's private Caribbean island as part of a probe into whether Mr. Staley told the truth about his association with the convicted sex offender.

In a statement, a Barclays spokesman said Mr. Staley visited the island, Little St. James, twice, both times with his wife. Neither the bank nor Mr. Staley had previously acknowledged the visits publicly.

Investigators are comparing disclosures Mr. Staley made to Barclays -- and which the bank subsequently made to U.K. financial regulators -- with a trove of emails and other documents handed over by Mr. Staley's former employer, JPMorgan Chase & Co., according to people familiar with the investigation.

Mr. Staley has said his relationship with Mr. Epstein was professional and began in 2000 when he was head of JPMorgan's private bank and the financier was a client. He told journalists on Feb. 13 that his interactions with Mr. Epstein began to "taper off" after he left JPMorgan in 2013 and that the last time he had contact with him was in the "middle to fall" of 2015. He became Barclays CEO in December 2015.

"Mr. Staley visited Little St. James twice, accompanied by his wife on both visits," a Barclays spokesman told The Wall Street Journal. "The visits to Little St. James, and his meetings at the Manhattan address where Epstein maintained an office, were disclosed to the board."

The U.K.'s Financial Conduct Authority and Prudential Regulation Authority are examining "Mr. Staley's characterization to the company of his relationship with Mr. Epstein and the subsequent description of that relationship in the company's response to the FCA," Barclays said in a Feb. 13 statement.

At that time, the Barclays board said Mr. Staley had been "sufficiently transparent" about the nature and extent of his relationship with Mr. Epstein.

The FCA, the U.K.'s financial watchdog, determines whether executives are "fit and proper" to lead.

Mr. Epstein pleaded guilty in 2008 to prostitution counts in Florida.

This year, prosecutors in the U.S. Virgin Islands, of which Little St. James is part, alleged Mr. Epstein abused hundreds of young women and girls until 2018. The prosecutors said that for nearly two decades, Mr. Epstein brought girls as young as 11 to his secluded property on Little St. James.

Mr. Staley had a large sailboat custom-designed, which he and his family have regularly taken to the Caribbean. He once took the boat to Mr. Epstein's island, Bloomberg has reported.

JPMorgan provided the emails and other documents to the FCA and regulators in other countries who were probing Mr. Epstein, according to people familiar with the situation.

Sherborne Investors, which owns more than 5% of Barclays, said on March 2 that Mr. Staley should step down because of his links to Mr. Epstein. "We believe that it would be in everyone's interest to draw a line under this destabilizing situation, which has become a circus, as soon as possible," Sherborne said.

Mr. Epstein was found dead in a Manhattan jail in August last year. His death was ruled a suicide.

Last summer, following renewed media interest about the relationship between Mr. Staley and Mr. Epstein, Mr. Staley "volunteered" to Barclays Chairman Nigel Higgins and executives "an explanation of his relationship with Mr. Epstein," Barclays said in February.

The FCA made an inquiry into the relationship and Barclays responded, the bank said. Regulators commenced a formal investigation in December, which is ongoing, Mr. Staley told journalists on Feb 13.

Some Barclays employees have expressed concerns to the regulators about the truthfulness of disclosures made by Mr. Staley and the bank, according to people familiar with the FCA probe.

"I deeply regret having had any relationship with Jeffrey Epstein," Mr. Staley told journalists in February. He said the investigation was focused on his "transparency and openness with the bank" and that he had been "very transparent."

On Feb. 25, Mr. Staley told colleagues that he was confident he would remain in his position and is "going nowhere."

Some people who have worked with Mr. Staley for years, including some who consider him a friend, have questioned his judgment in a series of missteps.

In 2018, Mr. Staley was fined for attempting to unmask a whistleblower, which U.K. regulators called a "serious error of judgment." U.S. authorities fined him over the episode. He apologized to the board after the incident.

He also waded into a messy dispute between KKR & Co. and his wife's brother, causing the U.S. private-equity giant to pull business from the bank. People he spoke to at the time said he told them he hadn't been acting in his capacity as CEO of a bank, but rather as a family member.

Write to Anna Isaac at anna.isaac@wsj.com, David Benoit at david.benoit@wsj.com and Simon Clark at simon.clark@wsj.com

(END) Dow Jones Newswires

March 06, 2020 05:44 ET (10:44 GMT)

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