Sept. 23 (Bloomberg) — Barclays Plc agreed to pay $15 million to settle regulatory claims that its U.S. wealth-management business failed to maintain an adequate internal compliance system and made trades without client approval.
Barclays failed to enhance its compliance procedures after it bought Lehman Brothers Holdings Inc.'s advisory business in 2008, the U.S. Securities and Exchange Commission said in a statement today.
"Barclays failed to establish this critical compliance foundation when it acquired Lehman's advisory business, and as a result subjected its clients to a host of improper practices and inadequate disclosures." Julie Riewe, co-head of the asset management unit in the SEC's enforcement division, said in the statement.
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The SEC fine was Barclays's second of the day. The London-based bank agreed today to pay a record 38 million pounds ($62 million) to Britain's market regulator for failing to properly protect 16.5 billion pounds of client assets, the Financial Conduct Authority said in a statement on its website.
In the SEC case, London-based Barclays made more than 1,500 transactions for client accounts without making required written disclosures or getting consent, the regulator said. It also earned revenue and charged commissions that didn't match disclosures for 2,785 clients, the agency said.
Barclays earned extra revenue of $3.1 million from its actions and caused client losses and overcharges of $472,000 the SEC said. The bank has since reimbursed or credited affected clients a total of about $3.8 million, the agency said.
"Barclays has fully cooperated with the SEC throughout this examination," the bank said in an e-mailed statement. "We have since strengthened our supervisory and control environment and remain committed to providing the best solutions and results for our clients worldwide."
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