- Five former traders on trial for conspiring to rig benchmark
- Harrison oversaw dollar trading for several years at bank
A senior Barclays Plc executive said he never saw or heard of any attempts to manipulate Libor at the British bank or any other firm when he was head of U.S. rates trading.
Harry Harrison, now head of non-core assets at Barclays, told a London court Tuesday that any requests to change the benchmark rate would have been "very inappropriate" and he wasn’t aware of any attempts. He was responsible for dollar rates for a number of years starting in 2003.
Harrison was speaking as a witness at the trial of former Barclays traders Jonathan Mathew, Stylianos Contogoulas, Jay Merchant, Alex Pabon and Ryan Reich. They are accused of conspiring to manipulate the dollar version of the London interbank offered rate from June 1, 2005, to Aug. 31, 2007. Lawyers for the defendants have alleged top executives including Harrison were aware of requests to change Libor to suit the bank’s positions and that the defendants were just following the standard practice.
Under cross-examination Merchant’s lawyer, Hugh Davies, said Harrison would put himself in "very real professional and personal jeopardy" if he said he knew of Libor-rigging. Harrison now reports directly to Barclays Chief Executive Officer Jes Staley.
Harrison joined the bank in 1989 as a graduate trainee and received no formal Libor training, saying he gained on-the-job experience. Merchant and the other defendants would have had similar preparation for the job, Harrison said. He added that while Merchant was "a promising trader,” he didn’t know him very well.
When asked whether traders who sold swaps should have been allowed to discuss the bank’s positions with employees on the cash desk, who set Libor, Harrison said it was a "gray area." The bank "should’ve been more prescriptive" about what conversations were acceptable, he said.
Davies asked what value the cash desk knowing the bank’s swaps positions could have other than influencing Libor submissions. Harrison drew laughs from the defendants when he answered that the traders may just have wanted to share their profits and losses.
The case is the third criminal trial in the U.K. of bankers and brokers accused of rigging the rates underpinning trillions of dollars in securities and loans.