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De May 2019 a May 2020
By Kristin Broughton
Barclays PLC has agreed to pay $6.3 million to settle charges from the U.S. securities regulator it violated bribery laws by hiring the children and relatives of high-ranking decision makers to win business.
The case involves the London bank's hiring practices in Asia. From at least April 2009 through August 2013, Barclays hired 117 people who had connections to its clients in the region, the Securities and Exchange Commission said Friday.
Many candidates were hired through an unofficial internship program for job candidates who, based on their connections, could help the bank win deals, according to the securities regulator.
Barclays violated the Foreign Corrupt Practices Act by using employment at the bank to influence deal making, and failed to maintain a system of internal controls around hiring, the SEC said. Additionally, employees at the company falsified records to conceal the identities of job candidates, the securities regulator said.
A spokesman for Barclays declined to comment.
Barclays is one of several global banks coming under scrutiny in the U.S. for hiring the friends and family of senior executives and government officials.
Among the several examples cited by the SEC, Barclays in 2009 hired the son of an executive at a South Korean state-owned company that bankers were pursuing for business. Soon after, the bank secured a deal to act as joint lead manager on a $1 billion bond issuance for the company that generated $971,000 in fees.
Similarly, in March 2013, bankers in Barclays's Asia-Pacific division hired the nephew of the chief executive of one of its key business clients. Two months later, Barclays recorded $2.6 million in revenue from the CEO's company.
Barclays voluntarily reported the conduct and took remedial actions, including terminating executives involved in the misconduct, before the government investigation, according to the SEC. The bank didn't admit or deny wrongdoing as part of the agreement.
The Justice Department also opened a probe into Barclays's hiring practices in Asia, which the bank announced in March 2016. A spokesman for the agency declined to comment on the status of that investigation.
Write to Kristin Broughton at Kristin.Broughton@wsj.com
(END) Dow Jones Newswires
September 27, 2019 17:31 ET (21:31 GMT)
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