Britain's Serious Fraud Office expects to complete an inquiry by the end of the year into Barclays and former executives over undisclosed payments made to Qatari investors in 2008, a London court was told on Thursday.
Andrew Onslow, a lawyer for the SFO, told the High Court the prosecutor expected to decide by early next year whether to bring any criminal charges in the investigation into Barclays' multi-billion pound capital raising to avert a state bailout at the height of the credit crisis.
Onslow made the announcement during a civil case brought against the bank by PCP Capital Partners, the investment vehicle of dealmaker Amanda Staveley, which is claiming around $1 billion in damages, alleging fraudulent misrepresentation.
In a row over whether Gulf investors received the same deal terms for participating in one of the Barclays fundraisings, PCP - which represented Abu Dhabi investors in 2008 - is accusing the bank of making "sham" payments to Qatari investors.
Barclays, which has called the case misconceived, on Thursday abandoned an attempt to postpone it until after the SFO concluded its criminal investigation. It was ordered to pay legal fees of 100,000 pounds ($145,000).
"We are very pleased with the outcome of today's hearing," said Bree Taylor, a partner at PCP's lawyers Fladgate. "Barclays now have to file a defence within for weeks and pay our legal costs."
Having argued in court earlier that it risked being accused of perverting the course of justice by re-interviewing suspects facing a parallel SFO inquiry, Barclays later told the court it would not "conduct any further interview with witnesses or suspects (but) go ahead and put in a defence."
PCP alleges Qatari investors earned a total of 346 million pounds in secret 'sham' payments. Had it known about this at the time, PCP argues it would not have agreed to split about 3.0 billion pounds of Barclays warrants with Qatar and would not have given up a 10 percent interest in the instruments, worth around 720 million pounds.
Barclays secured more than seven billion pounds from two emergency cash injections in 2008 - mainly from Middle East investors.
As part of the deal, Barclays said it paid 116 million pounds in advisory fees and commission to Qatar Holdings, but Britain's Financial Conduct Authority has said it failed to reveal two "advisory services agreements" with the Qatari company.
The FCA said the non-disclosure was "reckless" and fined the bank 50 million pounds. Barclays said it had disclosed one of the agreements, but not the value, and is contesting the FCA findings. That case is on hold pending the outcome of the SFO's investigation.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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