Westminster magistrates court will be the venue on Monday for the opening chapter in what is expected to be a landmark case arising from the 2008 financial crash. The former Barclays chief executive John Varley and three of his former colleagues – Roger Jenkins, Tom Kalaris and Richard Boath – are the first senior bankers to face criminal charges arising out of the crisis, and are due to appear in court in the afternoon.
The four are charged with offences following a five-year investigation into the events surrounding the £11.8bn emergency fundraising conducted by the bank in 2008 that allowed it to avoid a bailout by the taxpayer.
The decision to charge the four came after a series of postponements and amid plans in the Conservative manifesto for the Serious Fraud Office to be abolished – a threat that now appears to have been dropped after it did not feature in the Queen’s speech, which sets out the government’s agenda for the coming year.
Barclays raised billions from Qatar in 2008 to avoid a bailout. The charges related to two advisory services agreements entered into with Qatar Holding, an investment vehicle for the gulf state, in June and October 2008.
The four men and the bank are charged with “conspiracy to commit fraud by false representation in relation to a fundraising in June 2008”. In the event of conviction, the offences carry a maximum prison sentence of 10 years and a fine for the bank.
The general election threw up all sorts of unwelcome surprises for Theresa May at the beginning of last month. What effect this latest stormy period in British politics will have on the economy will emerge to some extent this week, with the release of the purchasing managers’ index (PMI) data on the services and manufacturing sectors. As the general election did not have the same effect as the EU referendum just over a year ago, there is not likely to have been as sharp a decline, but analysts at Investec think there will still be a drop.
“We suspect that the election outcome will not have led to a steep drop in the PMIs in the way we saw immediately after the 2016 Brexit vote, but a more modest decline,” said its preview of the figures.
Later in the week, official figures on construction output, trade and manufacturing output for May will be released, which will give further indicators on the state of the economy. A “less than robust” run of data could dissuade the Bank of England from raising rates over the coming months, according to Investec.
Butting heads at Bovis
It has been a difficult year for Bovis Homes. And a difficult one for some of its customers. The chairman of the housebuilder admitted in May that it had let down homebuyers, cutting corners to meet targets, and that hundreds had been affected.
Amid complaints of poorly built homes, the company set aside £7m for repairs earlier this year and faced accusations that it was pressuring customers to move into unfinished homes. Chief executive David Ritchie resigned shortly after a profit warning in December and was replaced by Greg Fitzgerald, the former chief executive of Galliford Try.
This week will give an indication of how the company is currently faring with the release of a trading update on Thursday. Since the problems at the company have been highlighted, the majority of its staff have been retrained. But on the Bovis Homes Victims group on Facebook, there have been claims that buyers are again being pressurised into moving into incomplete homes – a claim which the company has denied. There is clearly some confidence in the higher ranks as to its future, however, as Fitzgerald was reported to have spent £2m buying shares in June. This comes after Fitzgerald and his wife spent £1.4m buying stock earlier this year.