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Ex-Barclays ( JJCTF ) boss says he had no knowledge of Epstein's

crimes

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Staley facing finance industry ban, $2.3 million fine

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FCA says Staley approved misleading letter about

relationship

(Recasts with later evidence, adds details in paragraphs 4-8,

14-17)

By Sam Tobin

LONDON, March 11 (Reuters) - Ex-Barclays boss

Jes Staley on Tuesday insisted he was shocked by serial

paedophile Jeffrey Epstein's 2019 arrest for sex trafficking,

though Britain's Financial Conduct Authority (FCA) said that

contradicted his evidence in a separate case.

Staley began his second day in the witness box at his appeal

against a proposed ban and 1.8 million pound ($2.3 million) fine

by the FCA, saying he had no idea about late financier Epstein's

"monstrous activities".

The 68-year-old, who is fighting the ban at London's Upper

Tribunal, said in his witness statement that he was "shocked and

surprised" by Epstein's 2019 arrest for sex trafficking minors.

But lawyers representing the FCA said allegations

against Epstein were known within JPMorgan ( JPM ), where Staley

was previously head of the private bank and had Epstein as a

client, which undermined Staley's stance.

The FCA's lawyer Leigh-Ann Mulcahy also cited Staley's

own evidence in a lawsuit brought against him by JPMorgan ( JPM ) in the

U.S. Virgin Islands, which was

settled

in 2023.

Staley said in a deposition that he stopped speaking to

Epstein in 2015 as he realised he had lied about his "terrible

past", and Staley "was not that surprised" by Epstein's arrest.

Mulcahy said that was "inconsistent with your statement

in these proceedings", to which Staley replied: "You have found

two testimonies where there seems to be an inconsistency."

Staley also said JP Morgan paid him when it settled its

lawsuit against him, adding: "I paid nothing."

Staley's high-stakes appeal has revealed details of

Barclays' ( JJCTF ) handling of the FCA probe into Staley, who left the

bank in 2021, and also sheds light on his ties to Epstein.

Epstein's arrest and death in custody also brought

scrutiny on the financier's other high-profile associates,

including Britain's Prince Andrew and Microsoft founder Bill

Gates.

'SHOULDER TO SHOULDER'

The FCA's lawyer Mulcahy asked Staley about Epstein's 2008

conviction for soliciting a minor for prostitution, after which

Staley visited him while Epstein was on work release.

Staley said in his witness statement that he had understood

it to be "an isolated transgression", adding in the witness box:

"If I was aware of his monstrous activities, I would not have

maintained a relationship."

Staley was asked about an email Epstein sent to Staley and

three others on the day he was released from prison in 2009, to

which Staley replied: "I toast your courage!!!!!"

Mulcahy also referred to internal JP Morgan correspondence

documenting concerns about Epstein before the bank ended the

relationship in 2013.

In September 2014, Staley's friend Michael Ovitz, who

co-founded Creative Artists Agency, emailed Staley a link to a

story which referred to multiple civil lawsuits brought against

Epstein by young women and girls.

Three months later, Staley emailed Epstein: "The

strength of a Greek army was that its core held shoulder to

shoulder, and would not flee or break, no matter the threat.

That is us."

Mulcahy asked whether that was a reference to "the legal

trouble that Mr Epstein was facing", which Staley denied.

Staley's appeal centres on a 2019 letter sent by Barclays

Chair Nigel Higgins to the FCA, which approached the British

bank shortly after Epstein's arrest.

The FCA says the letter contained two misleading statements:

that Staley "did not have a close relationship" with Epstein and

their last contact was "well before he joined Barclays ( JJCTF ) in 2015".

Staley says both statements were accurate.

Staley is expected to be in the witness box for the rest of

the week, with closing arguments to be made in April.