Barclays sued in U.S. lawsuit over $17 billion debt sale

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Barclays sued in U.S. lawsuit over $17 billion debt sale

In London is a branch of Barclays Bank.

NEW YORK Reuters -- Barclays Plc was sued on Friday in a proposed U.S. class action in which shareholders claimed they were defrauded in connection with the British bank's sale of $17.6 billion more debt than regulators had allowed.

A complaint filed in the U.S. District Court in Manhattan by two Florida pension plans seeks to hold Barclays responsible for declines in the prices of American depositary receipts ADR as costs mounted over the blunder.

The complaint said Barclays made materially false and misleading assurances in its annual reports that its internal controls over financial reporting were effective.

The bank overstated profit, understated operating and litigation and conduct expenses, and didn't disclose the overissuance in its 2021 earnings releases, it said.

The complaint said that the failure to have controls in place to account for the number of securities issued against the number of securities registered is an elementary failure of internal control that is so obvious as to be deliberately reckless.

Barclays didn't want to say anything. The defendants are Venkatakrishnan and his predecessor Jes Staley.

In March, the bank revealed that it had sold $15.2 billion more structured and exchange-traded notes than the $20.8 billion U.S. regulators had authorized. The oversold amount was increased by $2.4 billion in July.

On July 28 Barclays said it had set aside about 1.59 billion pounds now $1.73 billion due to the overissuance, and on July 28 said it offered to buy back the excess securities.

The bank said on Sept. 15 that investors had submitted claims covering $7 billion of securities.

Friday's lawsuit by the City of North Miami Beach Police Officers and Firefighters' Retirement Plan and the City of North Miami Beach General Employees' Retirement Plan seeks damages for Barclays ADR holders from February 18, 2021 to March 25, 2022.

The case is City of North Miami Beach Police Officers and Firefighters' Retirement Plan et al v. Barclays Plc et al, U.S. District Court, Southern District of New York, No.