4 Aug 2015

Libor rigging trader jailed for 14 years

6:52 am on 4 August 2015

A former British money trader has been jailed for 14 years for rigging a key international interest rate.

Tom Hayes is the first individual to face a jury trial for manipulating the Libor rate, used as a benchmark for trillions of pounds of global borrowing and lending.

Tom Hayes arriving at Southwark Crown court with wife Sarah, on 27 July.

Tom Hayes and wife Sarah arriving at Southwark Crown Court. Photo: AFP

The 35-year old was sentenced to 14 years in prison for conspiracy to defraud.

His trial marks a new phase in a seven-year global inquiry under which 21 people have been charged and some of the world's most powerful banks and brokerages have paid more than $US9 billion in regulatory settlements.

Britain's Serious Fraud Office alleged Hayes set up a network of brokers and traders spanning 10 financial institutions and cajoled or bribed them to help rig Libor rates for profit between 2006 and 2010, when he worked for the Swiss bank UBS, then its US rival Citigroup.

The prosecution had said Hayes simply ignored "red flags" as a global investigation into Libor rigging allegations, instigated by US regulators at the height of the credit crisis in 2008, gathered momentum in 2009 and 2010.

Hayes, who has been diagnosed with mild Asperger's Syndrome, said during his trial he had been transparent about trying to influence rates and that his managers were aware of and condoned trading methods that were common industry practice.

He said he received no training, that Libor was at the time unregulated, his requests for rate levels fell within a "permissible" range and that he left a trail of emails and computer chats because he didn't think he was doing anything wrong.

Hayes stood impassively as the foreman on the jury read out all eight guilty verdicts. Half the 14 years sentence wis to be spent in custody before any possibility of release on licence.

Justice Cooke said Hayes was the "centre and hub" of the manipulation.

He said: "You succumbed to temptation because you could... To gain status, seniority and remuneration," adding that Hayes' actions were "dishonest and wrong".

- BBC / Reuters

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