Aug 20, 2017

Law firm quit as Barclays adviser over Qatar loan fears

Linklaters, the big British law firm, resigned from advising Barclays over a controversial loan to Qatar at the heart of a $1bn lawsuit over fears it would be illegal, court documents have claimed. Barclays instructed the law firm to advise it on the $3bn loan it made at the height of the financial crisis, just as the Gulf state was investing in the bank as part of an £7.3bn emergency cash call to avoid a state bailout. PCP claims Barclays paid Qatar £2.4bn in secret side arrangements and undisclosed fees, which had the effect of limiting the amount of its own money that Qatar ploughed into the bank. PCP's new documents allege that Linklaters quit a day after it urged including in the loan documentation a caveat that the loan would not be reinvested in Barclays. PCP's documents continue: "It should be inferred from this email that i) Linklaters resigned because it was concerned that the Qatar loan would be illegal, specifically that it would involve unlawful financial assistance by Barclays for the purchase of its own shares; and ii) Barclays believed that this was the actual reason why Linklaters had resigned."

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