NEW YORK/LONDON, Nov 2 (Reuters) - New York state’s banking regulator will be interviewing senior Barclays executives from New York and London over a whistleblowing scandal in the coming weeks, a source familiar with the situation said.
The New York Department of Financial Services (NYDFS) has been investigating Barclays Chief Executive Jes Staley and the bank for months over his attempt to identify an anonymous whistleblower last year, said the source, who declined to be named because of the sensitivity of the inquiry.
It was unclear which senior executives would be interviewed.
Barclays said in April that regulators on both sides of the Atlantic were investigating Staley and the bank for alleged breaches of strict whistleblowing rules. He has already been questioned by British regulators.
A spokeswoman for the NYDFS, which oversees certain foreign banks that operate in the state, and a spokesman for Barclays declined to comment.
Barclays has said Staley asked the bank’s internal security team to contact U.S. enforcement officers to help identify the author of an anonymous letter that made allegations about a senior banker. The identity of the person was not discovered by the regulators, according to a legal investigation commissioned by the bank.
Staley, a career investment banker who spent 34 years at JPMorgan, has apologised for his actions, telling Barclays staff in a memo this year that he had been attempting to protect a colleague from an unfair personal attack but became too “personally involved”.
Barclays has reprimanded him but said he “honestly but mistakenly” believed it was permissible to identify the author of the letter. It said it would cut his bonus and also look into the position of other employees involved in the incident.
The whistleblowing scandal at a bank that has promised to reform after a legacy of financial crisis-era misconduct could result in Barclays facing another fine and regulators could force Staley out, if he is deemed unfit by regulators.
It is a test case for Britain’s fledgling Senior Managers Regime, introduced by the Bank of England and the Financial Conduct Authority in March 2016 in part to protect those who risk their jobs bringing wrongdoing to light. The regime makes managers personally accountable for their actions to set what regulators have described as the right “tone at the top”.
Among other things, bosses are required to respect rules to protect whistleblowing. The penalty can be a ban from the industry or a fine.
Since the scandal erupted, Barclays’ global head of whistleblowing Jonathan Cox has departed, chief compliance officer Michael Roemer left to join rival Wells Fargo and Troels Oerting, the head of cyber and information security, has taken a leave of absence.
Oerting’s absence was not related to the whistleblowing investigation, a separate source has said. Oerting did not respond to requests for comment on LinkedIn, Cox has declined to comment and Roemer said last month his time at Barclays had been rewarding. (Reporting by Karen Freifeld in New York and Kirstin Ridley in London; Editing by Edmund Blair and Susan Fenton)