Does SFO need Barclays’ scalp as May sharpens her axe?

THE final scene in The Big Short puts its finger on why the general public is so narked about the banking crisis.

Despite all the fraud that went on, the movie concludes, despite all the rule-bending, despite all the blind eyes, only one banker — one! — ever went to jail. “Poor schmuck,” it concludes.

That fact, and the rage it creates in people still dealing with the consequences of the financial crisis a decade later, means many will rejoice at the charges brought today against some of the biggest bankers of that era, and one of Britain’s biggest banks.

Those individuals accused deserve a fair hearing. It would be wrong to speculate on the whys and wherefores of the allegations swirling around Barclays’ Qatar fundraising ahead of their trials. But one part of today’s Serious Fraud Office strike is worthy of speculation: why did the SFO decide to drag Barclays through the courts rather than grant one of its shiny new deferred prosecution agreements?

DPAs, which enable prosecutors to extract huge fines in return for a quick settlement and no destabilising criminal trial, have been SFO boss David Green’s biggest innovation. He has wheeled them out for Tesco, Rolls-Royce and Standard Bank. Yet in the case of Barclays, he declined. The rules on who can qualify for a DPA are clear: primarily, get out the sackcloth and ashes and cooperate like your life depends on it.

Clearly, the inference here has to be that Barclays didn’t grovel enough.

It wouldn’t be the first time the bank had refused to play ball with investigators: unlike others who paid up fines from the all-powerful US Department of Justice for selling junk mortgages, Barclays is taking it through the courts.

Likewise, it originally took a combative approach against the SFO over Qatar, refusing to hand over internal documents it claimed were privileged.

Barclays sources contend that, when current boss Jes Staley arrived, he reversed that and tried to play nice. Yet despite his conciliatory approach, the SFO still opted for a full-blown prosecution.

That’s odd, until you realise that there’s another reason DPAs can be ruled inappropriate: if they’re not in the public interest.

The SFO won’t say, but you have to ask: is Barclays is being taken to court to be made an example of to the baying public?

The “poor schmuck” in The Big Short who went to jail was Kareem Serageldin. Ever heard of him? Thought not. PR-wise, it would be convenient for a big name like Barclays to take his place.

Meanwhile, a successful prosecution wouldn’t harm

Green’s efforts to save his organisation from Theresa May’s attempts to kill it.

@ArmitageJim