On 28 February, former senior Barclays executives Roger Jenkins, Tom Kalaris, and Richard Boath were all acquitted of conspiracy to commit fraud contrary to section 1(1) of the Criminal Law Act 1997, and fraud by false misrepresentation, contrary to section 1 of the Fraud Act 2006.  The case is the latest in a series of high profile setbacks for the Serious Fraud Office (“SFO”), which failed to persuade a jury that the three had conspired with former chief executive John Varley and chief financial officer Chris Lucas to channel secret fees to Qatar in return for the Gulf state injecting £3.9 billion into Barclays in two cash calls in June and October 2008. The investment was credited with assisting the bank in avoiding the need for a UK government bailout in 2008, unlike two of its clearing bank rivals.

Project Birdcage

The case stems from Barclays’ Project Birdcage, a strategy devised in May 2008 to raise capital from sovereign wealth funds in China, Japan, Singapore and the Middle East. Gas-rich Qatar was a “cornerstone investor” whose commitment was hoped to incentivise others to invest. Barclays’ mandated fees of 1.5% to be paid to each investor in exchange for shares. However, Barclays also entered into an Advisory Services Agreement (“ASA”) under which the Qataris were paid £322 million in exchange for their investments and for the provision of other valuable services to Barclays.

The SFO alleged that prospectuses and subscription agreements (both of which are public documents) sent to investors during the cash calls of June and October 2008 contained fraudulent misrepresentations. In particular, the SFO alleged that a statement that there were no other fees or commissions payable by Barclays in connection with the investments, apart from those disclosed in the public documents, was untrue because the fees paid under the ASA were not disclosed.

Barclays led evidence that the board of directors were aware of the ASA and received advice from its lawyers that the ASA was legal provided that the bank received valuable services from the Qataris. It was acknowledged that the ASA was affiliated with cash injections but argued that the ASA a genuine mechanism to pay Qatar in return for valuable services. The executives reminded the court that side deals such as the ASA were common in banking and that the ASA made sense in its own right. In response, the SFO claimed that Barclays never intended for valuable advice services to be supplied by Qatar.


The jury reached an acquittal verdict in less than 6 hours. The result is unquestionably damaging for the SFO given its already fragile conviction history. Mr Boath’s legal counsel called for a review of SFO decision-making in light of this latest setback and the contrast with the FCA’s 2017 decision not to pursue sanctions against Mr Boath. He commented:

“What was the SFO doing spending millions prosecuting Mr Boath, when he had been cleared of exactly the same conduct by the FCA? The new attorney general should conduct a thorough review as to why the SFO repeatedly demonstrates such poor judgment. While victims go without redress in a rising tide of fraud due to a lack of investigative resources, the SFO has just wasted many millions on an utterly vacuous prosecution.”

A spokesperson for the SFO justified the proceedings on the basis of the evidential and public interest tests being met. Earlier this year Lisa Osofsky, the director of the SFO, blamed the SFO’s poor conviction rate on the high evidence threshold of fraud. Osofsky said to the BBC:

“I wish we had some of the lower [evidential] standards for fraud because we have an antiquated system… In fraud cases I’ve got to have the controlling mind of a company before I can get a corporate in the dock. That is a standard from the 1800s, when mom and pop ran companies. That’s not at all reflective of today’s world.”

Many will question whether the cure for the failings of the SFO is really lowering the criminal burden of proof. The judgment draws a line under the seven and a half year investigation and is likely to bring further scrutiny and calls to reform the SFO’s future approach to corporate entities suspected of misconduct.