Barclays hit with record £37.7m fine for failing to adequately protect funds

The Financial Conduct Authority (FCA) said Barclays put £16.5bn of client assets at unnecessary risk in the event that the bank had become insolvent.

It is the highest fine ever imposed by the FCA or its predecessor the FSA for client assets breaches, reflecting “significant weaknesses” in the systems and controls at the investment banking arm between 2007 and January 2012. The regulator said Barclays had failed to apply lessons from previous enforcement actions, as well as numerous industry-wide warnings.

FCA director of enforcement Tracey McDermott said: “All firms should be clear after Lehman that there is no excuse for failing to safeguard client assets.”

The fine, which comes three years after another Barclays subsidiary was penalised £1.1m for similar matters, relates to the period prior to the appointment of Antony Jenkins as the bank’s group chief executive.

Barclays said it did not profit from the issue and no customers lost out.

In a statement, the bank said: “Barclays identified and self-reported to the FCA the issues giving rise to the FCA’s findings and we accept their conclusion.

“Barclays has subsequently enhanced its systems to resolve these issues and to ensure we have the requisite processes in place.

“No client has suffered any loss as a consequence of this weakness in our processes which existed prior to January 2012.”