LISA BUCKINGHAM: Barclays boss Jenkins must act to clean this sewer

No wonder the tone was so forceful and impassioned in the email sent last week by Antony Jenkins to his 140,000 staff at Barclays, telling them to clear off if they could not abide by improved standards of behaviour. The stench of corruption at Barclays must be overwhelming him.



As we report today, Jenkins was barely weeks into his role as chief executive when he was confronted with evidence that the bank’s wealth management operation was running dangerously out of control.



US regulators warned on what they saw as a dysfunctional business; domineering bosses demanded sales at all costs; an external investigation found the culture was broken and a senior executive had shredded the report drawn up by those investigators and subsequently denied it ever existed.



Bad smell: The stench of corruption at Barclays must be overwhelming Antony Jenkins

Jenkins, it will be noted, took over as chief executive of Barclays last summer after his predecessor Bob Diamond was removed after Bank of England Governor Sir Mervyn King demanded his scalp when Barclays became the first bank to be linked to the global Libor-rigging scandal.



To some extent Jenkins can blame the latest scandal at Barclays Wealth on the culture of Lehman Brothers and Merrill Lynch, whose model and people formed the core of its expanded US business.



Possibly the aggressive culture had not had time to respond to something rather more acceptable from this side of the Atlantic. Except Barclays Wealth is a British firm whose two top executives were based in Britain at the time.

Andrew Tinney, the chief operating officer who has now quit, shredded the report – then denied to Jenkins it had ever existed. Tom Kalaris, an appointee of Diamond, was not just head of Barclays Wealth but co-chief of Barclays America. He is one of the handful of most senior executives at the bank.



It beggars belief how such compliance and behavioural failings can have passed him by. And, if he did find the goings on at Barclays Wealth acceptable, how can he be one of those staff who feel comfortable to work under Jenkins’ new regime?



Jenkins can blame Barclays’ less than illustrious record of misbehaviour on the previous regime. It is in the spotlight for mis-selling interest rate swaps to small businesses.



Also, the circumstances around the way it raised capital from Qatar in 2008 are under investigation by the Financial Services Authority and Serious Fraud Office, while the American Department of Justice continues to look into allegations of improper payments in Saudi Arabia.



However, Jenkins cannot dodge the fact that he was head of the retail bank when PPI mis-selling was rampant. The bank now faces a compensation bill for £2 billion and rising.



And, as our investigation on Page 87 reveals, the bank he now runs is still showing a stubborn refusal to do the right thing by thousands of investors, many of whom are elderly, and recompense them for huge losses when their life savings were recklessly invested in high-risk shares.



Barclays is trying to shirk its responsibilities by shamefully sending out impenetrable letters full of rubbish equations based on a bizarre secret formula agreed with the Financial Services Authority. Surely this is not what Jenkins means by ‘never making money in a way which is unethical or inconsistent with our values’.



He has the test of his life when he lays out his strategy next month. He must act decisively to clean the sewer that is Barclays Wealth. Bonuses must be clawed back for this division’s failings, just as they will be from those implicated in the Libor scandal. Heads need to roll fast.

Another high street failure and yet again we have thousands of shoppers left clutching worthless vouchers.



It is clearly unacceptable for retailers to take customers’ cash, in the case of HMV nearly up to the moment it collapsed, then refuse to honour the commitment. The decision is, of course, discretionary. In the case of Comet, the chain first refused to honour vouchers but when faced with bad publicity did a quick rethink. The same administrator is refusing to pay up at HMV, even though there is a good chance it will be rescued.

