Corporate Punishment US regulators hit Barclays Bank with $13.75mil suit

The US Financial Industry Regulatory Authority (Finra) said Barclays Capital will pay more than $10m in compensation to the customers affected.

  • Published:
24/7 Live - Subscribe to the Pulse Newsletter!

Barclays investment bank is to pay more than $13.75m (£9.3m) over accusations it let US customers make unsuitable mutual fund deals over five years.

The US Financial Industry Regulatory Authority (Finra) said Barclays Capital will pay more than $10m in compensation to the customers affected.

The bank will also pay a fine of $3.75m.

Barclays has not admitted wrongdoing in agreeing to the settlement, which includes a censure.

The regulator said that between January 2010 and June 2015, Barclays failed to supervise adequately procedures that saw many customers swap one mutual fund for another.

In many instances, the benefits of switching funds may have been undermined by the transaction costs, it added. More than 6,100 fund switches took place during the five-year period

A total of $8.63m was lost by customers in this way during the five years and most customers were not warned by the bank of the cost of switching before doing so, the regulator said.

Finra added that from March to August 2014, Barclays processed 1,723 fund transactions, or 39% of those it reviewed, that were inconsistent with its customers' investment aims, risk appetite or other investments.

The fine comes two months after Barclays appointed former JP Morgan senior executive James "Jes" Staley to the role of chief executive and signalled its renewed focus on investment banking.

Mr Staley is in the process of cutting costs within the bank and disposing of assets that are not seen as core to the business.

In November, Barclays was fined £72m in the UK for failing to conduct proper checks on very rich clients because it did not want to inconvenience them.

The City regulator said Barclays arranged a deal worth £1.88bn for wealthy clients in 2011 and 2012, which it kept quiet.

It did not conduct the proper checks on clients who should have been considered politically high risk.

Credit- BBC

Do you ever witness news or have a story that should be featured on Pulse Ghana?
Submit your stories, pictures and videos to us now via WhatsApp: +233507713497, Social Media @pulseghana: #PulseEyewitness & DM or Email:

Recommended Articles

Recommended Videos

Top Articles

1 Software Scandal EOCO indicts SSNIT managers over $72m software scandalbullet
2 Salaries In 2018 Here are the dates public workers will be paid in 2018bullet
3 In Accra Susu collectors give gov’t 1 week ultimatum to stop NPP...bullet
4 Collapsed Banks Assets of UT Bank and Capital Bank for salebullet
5 Excise Tax Stamp Act Gov’t threatens to sanction businesses that...bullet
6 NPP Government Nana Addo nominates Dr Agnes Adu as MD of GTFCbullet
7 David Ampofo Writes Is Ghana's cashew another cocoa?bullet
8 Taxes In Ghana 3% VAT flat rate takes off in July 1bullet
9 Menzgold Ghana Don't deposit money with Menzgold – BoG...bullet
10 In Singapore Government to pay bonus to all citizens...bullet

Top Videos

1 New Discovery Ghana discovers new mineral, lithium in commercial quantitiesbullet
2 Forbes 2018 Africa's billionaires rich listbullet
3 Money Alert Meet Africa's richest womanbullet
4 Support Finance minister buys Kantanka carbullet
5 Dr Joseph Siaw Agyepong Nobody can collapse my company – JOSPONGbullet
6 Plane Crash Starbow suspends operations following plane crashbullet
7 Bozoma Saint John 10 quotes from Uber top official, Bozoma,...bullet
8 Video We are determined to move Ghana beyond aid - Bawumiabullet
9 Entrepreneurship How to be resourceful as an entrepreneurbullet
10 Vodafone adbullet