LONDON, Nov 26 (Reuters) - Roger Jenkins, a former senior Barclays banker tasked with securing a financial lifeline from Qatar at the height of the credit crisis, told a London fraud trial on Tuesday he had been taken aback at the fees demanded by the Gulf state.
Jenkins, 64, told a jury at the Old Bailey criminal court that he had expected Hussain Al-Abdullah, the negotiator for Qatar’s former prime minister Sheikh Hamad bin Jassim bin Jabr al-Thani, to play hardball when he and colleagues met him in his suite at London’s luxury Claridges Hotel on June 3, 2008.
But he said he was surprised when Al-Abdulla, known as Dr Hussain, demanded a fee of 3.75 percent for participating in the first part of what would become an 11 billion pound ($14 billion), two part capital raising over 2008.
“It was a surprising ask on his side; the size of it,” said Jenkins, giving evidence for the second day in the high-profile trial. “I knew that he would ask for something — it’s the nature. I had expected 2%, maybe 2.5%. I hadn’t expected the magnitude of the ask, so I was a little taken aback.”
The case revolves around how Barclays avoided the fate of Lloyds and Royal Bank of Scotland and averted a state bailout with an 11 billion pound ($14 billion) fundraising in June and October 2008.
Jenkins, the former head of Barclays’ Middle East business, and co-defendants Tom Kalaris, who ran its wealth division, and Richard Boath, a former head of European financial institutions, deny conspiring to commit fraud by false representation and fraud by false representation.
Prosecutors for the UK Serious Fraud Office allege the former executives lied to the market and other investors by not properly disclosing 322 million pounds paid to Qatar, disguised as “bogus” advisory services agreements (ASAs), in return for around four billion pounds in investments over 2008.
Qatar, a major investor in Britain, and Sheikh Hamad are not accused of wrongdoing.
In brief defence statements, the men have alleged that the ASAs were side deals to secure lucrative business for Barclays in the Middle East — a region the bank was eager to exploit — that had been approved by internal and external lawyers and cleared by the board.
Jenkins told the court how he courted Sheikh Hamad and his senior executives, discussed a range of investment opportunities and offered to send a chief operating officer and risk officer to Doha for a year to advise the oil and gas rich country, which was keen to diversify its wealth, on asset allocation.
Jenkins, a former competitive sprinter who was once one of Britain’s best paid bankers, also introduced Dr Hussain to London-based property mogul Robert Tchenguiz in late May 2008 to discuss the performance of supermarket chain Sainsbury’s , in which both had a significant stake, according to emails shown to the jury.
John Kelsey-Fry, Jenkins’ lawyer, asked whether Barclays had been paid for the time spent trying to find staff to second to Doha.
“It didn’t cost me very much, just a few phone calls,” Jenkins responded.
“Why are you doing it?” his lawyer, asked.
“To assist,” Jenkins said.
The trial is scheduled to last about five months.
$1 = 0.7794 pounds Reporting by Kirstin Ridley. Editing by Jane Merriman