Barclays PLC (LON:BARC) chief executive Jes Staley has been fined £642,430 by regulators over this attempt to unmask the identity of a whistleblower.
The Financial Conduct Authority and the Prudential Regulation Authority said in a joint statement that Staley “failed to act with skill, care and diligence” in response to an anonymous letter received by Barclays in June 2016.
The regulators said Barclays will need to provide annual updates on its policies for handling whistleblowing.
“Mr Staley breached the standard of care required and expected of a Chief Executive in a way that risked undermining confidence in Barclays’ whistleblowing procedures,” said Mark Steward, executive director of the FCA’s Enforcement and Market Oversight.
“Chief executives must act with a high degree of care and prudence at all times.
“Whistleblowers play a vital role in exposing poor practice and misconduct in the financial services sector. It is critical that individuals are able to speak up anonymously and without fear of retaliation if they want to raise concerns.”
Barclays to cut Staley's compensation
Barclays released a statement saying that its board has decided to reduce Staley's variable compensation for 2016 by £500,000.
Staley's basic pay in 2016 was £2.35mln plus a £1.31mln bonus. His basic pay remained the same in 2017 with a £1.06mn bonus.
Chairman John McFarlane said the board takes the bank's "culture and the integrity of its controls extremely seriously".
"The group's whistleblowing processes are fundamental to ensuring that individuals feel comfortable raising concerns and are encouraged to do so," he said.
He added: "The board is pleased that the FCA and PRA's investigations have concluded and are now behind us."
In April, Barclays said the regulators had proposed Staley pay a fine but the amount was undisclosed.
READ: Barclays CEO Jes Staley to be fined by UK regulators for whistleblowing incident
The bank had said it continues to have “unanimous confidence” in Staley and recommended his re-election as a director at the company’s annual general meeting earlier this month.
Shareholders back Staley's re-election despite scandal
More than 99% of shareholder votes were in favour of Staley’s reappointment at the meeting.
Staley has previously apologised for his actions, explaining that he was trying to protect a colleague who had experienced "personal difficulties in the past from what he believed to be an unfair attack".
In a statement today, he said: "I have consistently acknowledged that my personal involvement in this matter was inappropriate, and I have apologised for mistakes which I made.
"I accept the conclusions of the Board, the FCA, and the PRA, following their respective investigations, and the sanctions which they have each applied."
Staley had attempted to identify the author of an anonymous letter received by Barclays that claimed to be from a shareholder. The FCA and PRU said the letter contained “various allegations, some of which concerned Mr Staley”.
“Given his conflict Mr Staley should have maintained an appropriate distance; he should not have taken steps to identify the author,” the regulators said.