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Sat 10 Nov 2012 10:46 AM

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Barclays 'facing probe' over Saudi bank licence

British bank said to be under investigation by US over how it secured licence in kingdom

Barclays 'facing probe' over Saudi bank licence

Barclays is under investigation by US authorities over how it secured a banking licence in Saudi Arabia, it was reported on Saturday.

According to the UK's Financial Times, an investigation is underway by the US Department of Justice into whether the bank made improper payments to secure the licence.

Officials are examining how the UK bank got a licence to run investment banking and wealth management operations in the Gulf country in 2009, the FT said.

Barclays said last week that it is co-operating with an investigation by the DoJ and the Securities and Exchange Commission into whether it breached the Foreign Corrupt Practices Act (FCPA).

The bank is also facing an investigation by the Serious Fraud Office in the UK into the fees it paid in 2008 to Qatar's sovereign wealth fund as it raised capital at the height of the financial crisis.

Barclays raised £4.5bn in June 2008 followed by a £7bn cash call in November that year from Qatar and Abu Dhabi investors to avoid taking a government bailout.

Barclays' profit of more than £4bn ($6.3bn) in the first six months of the year beat forecasts.

In May, Barclays, Britain’s second-biggest bank, said it is seeking to boost revenue from the Middle East and North Africa by as much as 25 percent annually over the next five years and will hire about 100 people in the region in 2012.

Revenue “aspirations are in the range” of a 20 percent to 25 percent compound annual increase, helped by the wealth, investment management and trade finance businesses, John Vitalo, chief executive officer for the Middle East and North Africa, said.

The bank will add about 100 people to its staff of about 1,000 in the region, he said.

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Mark Zoro 7 years ago

How does the DOJ & US authorities get involved in everything outside US? - World Police???????

Karim 7 years ago

What does the US have to do with this?

Legal Beagle 7 years ago

It's called the The Foreign Corrupt Practices Act of 1977 (FCPA). That's what the US has to do with it. Barclays has a presence in the US, therefore it is subject to FCPA actions.