UT (Tax & Chancery) UT-2023-000064 - [2025] UKUT 00203 (TCC)

The following summary of the Authority’s case is taken from [10] to [19] of its Amended Statement of Case:

“10.

In August 2019, following various media reports, the Authority contacted a member of Barclays Board requesting a written assurance that the Board had informed itself and was comfortable regarding any association of Mr Staley or Barclays with Mr Epstein.

11.

Barclays through its senior executives, engaged in discussions with Mr Staley regarding the response to be made. It was originally intended that Mr Staley would provide a letter which Barclays would send to the Authority, but it was decided, after discussion, including with Mr Staley’s own legal adviser, that Barclays should send the response instead.

13.

On 8 October 2019, in response to the enquiry by the Authority, Barclays sent a letter (“the Letter”) which contained two inaccurate and misleading statements: firstly, about the nature of Mr Staley’s relationship with Mr Epstein (stating “[Mr Staley] has confirmed to us that he did not have a close relationship with Mr Epstein”) and secondly, about the recency of the last contact between Mr Staley and Mr Epstein (stating that “[Mr Staley’s] last contact with Mr Epstein was well before he joined Barclays in 2015.”

13.

Mr Staley reviewed a near final draft of the proposed Letter which contained those two statements. He was expressly asked to confirm that the language was fair and accurate. Mr Staley confirmed he was comfortable with the language and in doing so recklessly approved its content.

14.

The two statements were material to the Authority’s enquiry, which sought to ascertain whether, in light of media reports, Barclays had informed itself and was comfortable regarding any association of Mr Staley and Barclays with Mr Epstein. The enquiry made by the Authority necessarily involved consideration of the media reports and the relationship between Mr Staley and Mr Epstein. The enquiry was not limited to a concern about whether Mr Staley was involved in or witnessed the conduct which was the subject of the allegations against Mr Epstein set out in the media reports but extended to the association between Mr Staley and Mr Epstein more generally and what Barclays had done to satisfy itself in this regard. In any event, statements as to the nature of the relationship and recency of contact were themselves relevant to whether Mr Staley was involved in or witnessed the conduct alleged on the part of Mr Epstein.

15.

Mr Staley must have appreciated because it was obvious (and the Authority contends, he did so appreciate) that the Authority would rely on the content of the Letter, in circumstances including that the Authority had made a specific enquiry of Barclays and required the provision of a written response, Mr Staley held a very important role as CEO of one of the UK’s most significant financial institutions and the fact of his association with Mr Epstein inevitably raised questions about his conduct and judgment.

16.

Further, Mr Staley must have been aware (and, the Authority contends, was so aware) that there was a risk that the Letter would mislead the Authority by inaccurately stating the nature of the relationship and the recency of the contact between them.

17.The conduct in allowing the misleading statements to be made to the Authority also constituted a failure to be open and transparent with the Authority and to make appropriate disclosure.

18.Such conduct was in breach of ICR 1, ICR 3 and/or SMCR 4.

19.

The proposed financial penalty and prohibition order are appropriate sanctions and are proportionate to Mr Staley’s failings, taking account of all relevant circumstances.”

13.The Authority also pleaded that Mr Staley has not been candid with the Authority in his interviews to the extent that his answers are misleading, and that he has done so recklessly. The Authority’s position is that certain answers in interview were misleading in the light of (i) the emails obtained from the Epstein Estate and (ii) the answers Mr Staley gave in his deposition, and in the light of those emails and answers that it is to be inferred Mr Staley was aware of the risk that his answers in interview would be misleading.

Mr Staley contends that the Authority’s case is flawed in that it invites comparison of the email correspondence passing between Mr Staley and Mr Epstein, and upon which the Authority heavily relies, with the terms of the Letter. By this route the Authority invites the conclusion that the Letter contained factual inaccuracies of which Mr Staley must have been aware, whereas Mr Staley’s case is that determination of the Reference should be informed by the factual context in which the Letter came to be drafted and approved. At that point, the factual context was such that the Letter was intended to achieve only one purpose, which was to inform the Authority that neither Mr Staley nor Barclays had had any knowledge of or involvement in Mr Epstein’s unlawful conduct. It was not intended to define the relationship between Mr Staley and Mr Epstein and the language employed was neither drafted nor approved for that purpose.

Mr Staley contends that his state of mind, in judging whether he was “reckless” when he approved the draft of the Letter, should be determined by a focus upon the context in which that approval took place and not through the prism of the email correspondence.