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Sun 22 Jun 2008 12:57 PM

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Qatari sheikh slaps Barclays with $75mn fraud suit

Gross negligence let employee channel millions into personal account, sheikh claims.

A Qatari sheikh has hit British bank Barclays with a50 million-euro ($75 million) fraud suit thatthreatens to derail its current fundraising efforts, the UK's Sunday Times has reported.

A senior member of Qatar's ruling Al Thani family is claiming gross negligence allowed an employee to channel around 4 million euros a month into a personal account in Marbella, Spain, the newspaper said, citing Spanish court documents.

The paper did not reveal the exact identity of the sheikh.

According to the Sunday Times, the allegations relate to transactions dating back to between December 2001 and February 2003.

It said several unsuccessful attempts have already been made to settle the dispute, but the sheikh is expected to turn up the heat on Barclays now that Qatar's sovereign wealth fund is considering backing a share issue by Barclays, which could raise more than 4 billion pounds ($7.81 billion) from investors.

The allegations made by the sheikh have come to light just a few days before Barclays begins its marketing campaign for the share issue to existing shareholders in the UK.

According to the Sunday Times, the Barclays employee, Gerald Gouallier, had opened joint bank account in Marbella under his and the sheikh’s name, an account which the sheikh claims he knew nothing of and that bore forged signatures.

On one day alone, $45 million was withdrawn from the account before the sheikh became aware of the transactions, which triggered questions about the efficiency of Barclay’s anti-money laundering policies when the account balance changed by large amounts on a regular basis, the newspaper said.

The sheikh claims that he was never contacted about any of these fund transfers by the bank, and that the transfers, like the account opening, were allegedly executed without proof of identity and with a forged signature, the newspaper said.

Gouallier and Juan Antonio Porras Guerrero, the manager of Barclay’s Marbella office, are both under criminal investigation in Spain, according to the paper.

Barclays declined to comment, the Sunday Times said.

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ron 11 years ago

Is it me or are a lot of banks just getting caught doing dirty deeds? Looks like a lot of banks require some sort of pest control. Or is this all some sort of cover act? "look we are totally transaparent"