The U.K. Serious Fraud Office might start a criminal investigation into Barclays Plc for alleged payments to Qatar’s sovereign wealth fund, according to a report Wednesday by Lindsay Fortado of Bloomberg’s Businessweek.
The alleged payments were made when the bank was trying to raise money during the 2008 credit crunch, the report said.
The investigation might be announced as early as this week.
The SFO and Barclays didn’t comment.
In October 2008, we noted that Steven Tyrrell, then the head of the Justice Department’s fraud section, said the credit crisis could produce a crop of Foreign Corrupt Practices Act cases.
‘The targets this time,’ Tyrrell said, ‘would be banks and others that went looking for cash from sovereign wealth funds in exchange for favors rendered to the host-country’s rulers.’
By early 2011, the SEC had launched a broad investigation into banks and private-equity firms that might have violated the FCPA in their dealings with sovereign wealth funds. At least ten firms received letters from the SEC, including Citigroup and Blackstone.
Barclays is Britain’s second-biggest bank. In June it paid $460 million to U.S. and U.K. agencies for manipulating the London interbank offered rate. CEO Robert Diamond resigned because of the Libor scandal.