Lawrence White and Iain Withers

LONDON (Reuters – The British Bank has operated for nearly six consecutive years. Barclays (LON:), American Jes Stealey has a good reputation for being a corporate survivor, but the ex-JPMorgan (NYSE) dealmaker couldn’t escape his past.

Staley (64), a turbulent tenure saw him resist a raider from the bank’s corporate arm, survive a probe into the mistreatment of whistleblowers, and become Britain’s third largest lender during the coronavirus pandemic.

However, it was Staley’s connections to Jeffrey Epstein (convicted sex offenders) that forced him to leave JPMorgan.

Barclays stated Monday that Staley has resigned as its chief executive officer following an investigation of British regulators. The regulators looked into Staley’s description of Epstein. This was both Barclays’s and theirs.

The Bank of England, UK’s Financial Conduct Authority and Bank of England have not yet published the details of their findings. However they have stated previously that the probe was focused on Staley’s honesty about Epstein’s ties. Epstein was arrested in August 2019 while Staley awaits trial for charges of sex traficking.

It was well-known that Epstein was Staley’s client, but media reports portray a more intimate relationship. Epstein traveled with his wife to Epstein’s Caribbean Island.

Barclays stated that Staley had intended to challenge UK investigations. According to the UK investigation, it did not prove that Staley saw or knew of any Epstein alleged crimes.

Staley previously stated that he regretted Epstein’s ties, which began at JPMorgan in 2000 and ended late 2015. This was before Staley joined Barclays in December 2015.

Epstein, who was convicted for soliciting a minor to prostitution in 2008, was registered as an sex offenders. According to the New York Times, Staley was reported as having visited Epstein while he was in prison.

Barclays Monday’s request for comments from Staley was not answered by the bank.

QUALIFYABLE JUDGMENT

Staley was hired by Barclays after its board decided to roll the dice. The U.S. banking veteran was once considered a potential successor to Jamie Dimon, Chief Executive of JPMorgan. Staley’s job is to transform the bank’s investment bank which was badly behind its Wall Street counterparts.

The bank had been struggling to achieve trading success for years. Edward Bramson an activist investor built up over 6% of the stake, and tried to separate the investment bank from the retail division.

Staley held firm to his guns, and stopped the attacks. Staley’s strategy paid off when volatility in markets caused by the COVID-19 epidemic led to an increase in investments banking profits. Bramson conceded defeat in May.

Staley was a favorite of Barclays’ insiders and traders at its investment bank. He brought some style to the fight against Wall Street rivals after the rather dreary tenure of Antony Jenkins.

Staley says that he admires Dimon and sought to follow his example by hiring JPMorgan lieutenants as he gambled big on investment banking during a period when British competitors were cutting back.

For 34 years, he was employed at the U.S. banking institution, rising through the ranks to manage its asset management, private bank and investment banks. In 2013, he left to start a hedge fund, after having been sidelined by a management restructuring.

Barclays has questioned Staley’s judgement. He was fortunate to be able to survive an inquiry by regulators about his attempts to expose a whistleblower that sent criticism letters to a senior Barclays employee.

The Bank’s effort to locate the whistleblower was a transatlantic endeavor, according to regulators. Staley’s office sought the assistance of the United States’ security staff and an employee.

Barclays and Regulators fined Staley together a total of 1.13 million pounds. However, Staley avoided more severe punishments.

Russ Mould from AJ Bell, an investment director said “This isn’t the first time Staley faces negative headlines.” His departure does not reflect on how crucial governance is, especially for high-profile companies like Barclays that are subject to regulatory and political pressure.