Hayes a Serial Libor Rigger, Not a Victim, Prosecutor Says

Tom Hayes was a serial market manipulator who knew he was behaving dishonestly when he cheated rival traders, rather than an innocent thrown under the bus by his former employers, prosecutors said during closing arguments.

This was “nothing more than a concerted campaign to do everything in his power to manipulate” Libor rates, prosecutor Mukul Chawla told London jurors Monday. “By doing what he was doing he was seeking to rig the market.”

Hayes, who worked at UBS Group AG and Citigroup Inc. in Japan, is charged with eight counts of conspiracy to manipulate the London interbank offered rate, the benchmark used to value more than $350 trillion of loans and securities. Each count carries as much as 10 years in prison.

Prosecutors say Hayes bullied and cajoled fellow traders and brokers to move Libor to make his positions more profitable. Hayes’s lawyers say the practice was widespread.

Sitting next to his lawyers, Hayes, dressed in an open-necked blue shirt and a black sweater, frequently shook his head and hands during Chawla’s speech and spent much of the time taking notes.

“Despite his high intelligence he has put before you an impression of a lonely junior figure simply adopting the diktats of management,” Chawla said. You must reject that, he added.

Chawla said it was irrelevant that his managers knew what he was doing or that others in the market were also manipulating Libor.

“Does a dishonest act become an honest one simply because others are doing it too,” Chawla said. “Do you need someone to tell you something is wrong?”

It was “fanciful” to believe that Hayes was acting under the orders of his managers or anyone else, Chawla said.

“Mr. Hayes was at the center of this,” Chawla said. “He was the driver.”

Chawla urged jurors to dismiss Hayes’s oft repeated contention while he was on the witness stand that he was being unfairly singled out for actions that were simply standard practice across the industry.

“Mr. Hayes is the first but by no means the last” to stand trial for rate manipulation, Chawla said. “He was never fired by UBS and chose to leave” to get a better job elsewhere.

Rather than being singled out, Hayes set the timetable for his own trial and arrest when in more than 80 hours of interviews with the Serious Fraud Office he agreed to plead guilty and cooperated with their inquiries, Chawla said.

“There’s not one law for traders and bankers and another for the rest of society,” Chawla said.

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