Barclays has decided to drop its appeal against a £40 million fine imposed by the UK’s financial watchdog over payments made to Qatari investors in connection with an emergency capital injection in 2008.

The Financial Conduct Authority (FCA) announced on Monday that the fine was levied for conduct that was “reckless and lacked integrity,” following Barclays’ decision to abandon its legal challenge.

The FCA said Barclays breached the UK’s listing rules by failing to disclose £322mn that it agreed to pay for “advisory services” to Qatar Holding at the same time as it accepted up to £4.6bn in capital from the state-backed investment group and a second Qatari vehicle.

By omitting the details of the arrangement, the FCA said, Barclays misled the market about the costs associated with an overall £11.8bn emergency capital raising that it held to stave off a government bailout.

Barclays had been due to appeal against the FCA fine at London’s upper tribunal in a court case starting on Monday, in which the bank’s former chief executive John Varley was set to appear as a key witness.

But the bank abandoned the appeal, saying it wanted to “draw a line under the issues” even though it “does not accept the findings” of the FCA.

The move closes one of the final episodes in a legal saga that has swung back and forth for more than a decade, leaving the reputations of one of Britain’s biggest banks and the country’s main financial watchdogs in the balance.

Steve Smart, joint executive director of enforcement and market oversight at the FCA, said: “Barclays’ misconduct was serious and meant investors did not have all the information they should have had.”

But Smart added that “the events took place over 16 years ago and we recognise that Barclays is a very different organisation today, having implemented change across the business”.

The watchdog reduced its fine from the £50mn it announced in 2022. Recommended News in-depthUK banks Ex-Barclays chief John Varley pulled back into fight to clear bank’s name The controversy over the actions taken by Barclays has prompted criminal and regulatory investigations and two failed prosecutions.

Varley became the first chief executive of a major bank to face a jury over events during the financial crisis, though he was ultimately acquitted. Charges against Barclays itself were dropped before the trial began.

The case played a significant role in prompting a reform of corporate criminal liability in the UK. In 2020, former bankers Roger Jenkins, Thomas Kalaris, and Richard Boath were also acquitted of criminal charges.