Meet the Five Barclays Traders Accused of Rigging Libor

Three traders were convicted by London jury, with the panel unable to reach a verdict on the other two.

Three Former Barclays Traders Guilty of Rigging Libor

Three former Barclays Plc traders were found guilty of working together to rig Libor, the benchmark tied to trillions of securities. Jonathan Mathew, Jay Merchant and Alex Pabon, were found guilty of manipulating Libor. The jury was unable to reach a verdict on two others, Stylianos Contogoulas and Ryan Reich. The trial, which stretched close to three months, ended on Monday, and the men will be sentenced Thursday. Here's what you need to know about those who appeared in the dock in London.

Jonathan Mathew

London cash desk
Age: 35
Verdict: Guilty

Photographer: Jason Alden/Bloomberg

Mathew was portrayed as the nice, but ever so slightly dim Libor submitter who only got a job at Barclays because of his dad. A homebody who married his childhood sweetheart, he struggled through school, never went to university and his first finance job as a clerk at Cazenove in 1999 paid 10,500 pounds ($13,925) a year. With becoming a trader firmly in his sights, he took the regulator's exams and failed three times before passing.

Once on the cash desk, he managed the Canadian dollar book under the tutelage of Peter Johnson, the man the prosecution would hang the whole conspiracy around. Mathew told tales of trading floor hazing that resulted in regular humiliation, including being "whacked" round the head with a 12-inch baseball bat.

Since losing his job at the bank Mathew has trained as a chef and volunteered for a homelessness charity.

"I just felt married to the lie," Mathew said of being dishonest with prosecutors and regulators in a string of interviews. "I could not see a way out and I didn’t know what to do."

 

Stylianos Contogoulas

London swaps desk
Age: 44
Verdict: Jury unable to reach a verdict

Photographer: Jason Alden/Bloomberg

Contogoulas served 19 months in the Greek military and worked as a computer engineer for five years before moving into financial services. Married with a wife and two children, his family stayed in Athens for the duration of the trial. He'd often leave early on Fridays to fly back to see them.

He believed what he was doing wasn't improper or unfair, while prosecutors mocked him for not knowing what the word manipulation meant.

"There was no monetary advantage" to passing on requests to fix the rate at a certain level," Contogoulas told the jury. "As far as I was concerned it was part of my job, a very small part of my job but I still had to do it."

 

Jay Merchant

New York and London swaps desk
Age: 45
Verdict: Guilty

Photographer: Simon Dawson/Bloomberg

Born in Kolkata, Merchant showed great promise with a tennis racket in his hand, training six days a week from the age of four. He won a scholarship to Southern Illinois University where he was the best player on the squad, according to a teammate. After a stint as hitting partner to the Williams sisters, he turned his back on a professional tennis career to focus on finance. Joining Barclays in 2002 to work on the short-end book before the euro desk and then on the dollar desk in New York with the "glamor boys" and "big dogs" of the trading floor.

Merchant repeatedly said that senior Barclays managers approved requests being made to the cash desk, despite providing no documentation to back up the claim. Prosecutors said Merchant took young and inexperienced traders Alex Pabon, Ryan Reich and Contogoulas, under his wing and brought them in on the conspiracy to rig rates. Merchant was the best paid of all the defendants, making 2.2 million pounds in 2007.

"Everybody knew the banks set Libor to their own commercial interests," – Merchant said. "No one was trying to influence anything. We were just doing our job."

 

Alex Pabon

New York swaps desk
Age: 38
Verdict: Guilty

Photographer: Chris Ratcliffe/Bloomberg

Alex Jesus Julian Huffy Pabon was born in Louisiana and studied industrial engineering at Texas A&M University before getting a masters degree at the University of California, Berkeley, in financial engineering.

He came close to tears describing attempts to leave Barclays in 2006 because he was burnt out. He said he made Libor requests at the direction of Merchant and was trying to help Johnson better reflect the derivatives market.

Prosecutors highlighted the lack of evidence of any information given in his requests to Peter Johnson other than what suited his trading book and accused him of purely looking to gain an advantage over his counterparties.

"I guess it's three months between when I first tried to resign and when I actually resigned," Pabon said, explaining his departure from the bank in 2006. "I didn't really see anything getting better at Barclays. So, you know, this time I thought that I would resign and it would stick."

 

Ryan Reich

New York swaps desk
Age: 34
Verdict: Jury unable to reach a verdict

Photographer: Chris Ratcliffe/Bloomberg

Over 6-feet-tall with a shaved head, Reich played baseball at Princeton University and gives everything "100 percent." Princeton's head baseball coach testified as a character witness for him at trial.

Reich, who was born on the "Jersey Shore,” was only 24 when he joined Barclays. He said he never asked for false rates outside the acceptable range and there weren't clear guidelines. Prosecutors claimed Reich knew sending Libor-submission requests was dishonest.

"I'm a bit dull, I guess," Reich said while describing himself during his testimony. "I didn't drink in high school so that was kind of a thing. Most people do that. I didn't do that. I've never taken a drug. I'm not a big partier. I go to bed early. I like to exercise. I like sports."

Before it's here, it's on the Bloomberg Terminal. LEARN MORE