Sants will take a role working to improve the bank’s international reputation with governments and regulators. His salary is not being disclosed because he will not be a board director.
Barclays chief executive Antony Jenkins said, "Relationships with our regulators and governments around the world are obviously also of critical importance to us.
"With a huge wealth of private and public sector experience, and having most recently led one of the world's pre-eminent regulatory authorities, I can think of no more suitably qualified person than Hector Sants to take on these challenges."
Sants, who was widely reported to be in discussions to join accountancy giant Deloitte, resigned from the FSA in March after five years in the top role.
The former investment banker led the European arm of Credit Suisse prior to joining the FSA in 2004.
"I left the FSA with the intention of finding a role which would allow me to put into practice the experience I have gained in both the public and private sector," said Sants.
"Taking on the responsibility of leading Barclays global compliance function, and overseeing the bank's relationships with governments and regulators, gives me that opportunity," he added.
Sants will report directly to Antony Jenkins.
The appointment ends a difficult year for Barclays. Chief executive Bob Diamond and chairman Marcus Agius resigned after the bank was forced to pay a record £290m in June to regulators in the US and UK for manipulating the inter-bank lending rates Libor and Euribor.