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The Justice Department and SEC Investigate Barclays For Possible Anticorruption Violations

Recently, in October 2012, the United States Department of Justice (“DOJ”) and the Securities and Exchange Commission (“SEC”) launched an investigation into Barclays PLC (“Barclays”) regarding manipulation of U.S. electricity markets and anticorruption violations. Initially, the DOJ and SEC requested telephone records, e-mail communications and other documents from Barclays to determine whether or not it violated various laws when soliciting investments from the Middle East during the onset of the 2008 financial crisis. Specifically, the investigation will focus on whether Barclays employed middlemen brokers to bribe Middle Eastern politicians, corporate executives and companies to pledge funds to the bank during the financial crisis, which would constitute a violation of the Foreign Corrupt Practices Act. For example, it is reportedly believed that in June 2008, Barclays’ senior bankers bribed Qatar Investment Authority (“Qatar”) to invest $4.5 billion in the bank, in exchange for Barclays hiring Qatar to render advisory services in the Middle East. This investigation centers on past executives’ involvement in the bribery, including Finance Chief Chris Lucas. During the summer of 2012, the United Kingdom’s Financial Services Authority formally investigated Barclay’s public disclosures regarding its solicitation of investments from Middle Eastern companies, corporate executives and politicians. This investigation came to a height in the summer of 2008 when the Serious Fraud Office requested additional documents regarding the potential bribing in the Middle East. The DOJ and SEC investigation was reported by Barclays on Wednesday, October 31, 2012, when it simultaneously reported $170.4 million in third-quarter losses. In response to the DOJ and SEC investigation, Barclays began its own internal investigation to determine whether its business dealings and solicitation of investments from the Middle East violated US anticorruption laws. Lax & Neville LLP effectively assists investors, on both a regional and national level, that may have suffered losses as a result of their broker dealer’s breaches of fiduciary duties and/or disregard for their investment interests. Please contact our team of securities fraud attorneys for a consultation at (212) 696-1999.

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