U.K. Prosecutor Investigating 22 More People in Libor Probe
U.K. prosecutors are investigating 22 people as potential co-conspirators in relation to the rigging of the London interbank offered rate.
The fact that the U.K. Serious Fraud Office sent a letter to the individuals on Sept. 30 informing them they were being investigated in connection with Libor, can be reported after a judge declined to extend an injunction at a hearing today.
Eight of the 22 individuals were identified by the Wall Street Journal last week. An injunction forcing the newspaper to take the story down from its website was lifted by the judge at the hearing.
“I’m not enamored at the idea of anonymity,” Judge Jeremy Cooke said. The prospect of any of the 22 facing trial is “so far down the line” it “would not cause any risk of substantial prejudice” to lift the injunction.
Three people have been charged in the U.K. over Libor. Tom Hayes, a former UBS AG (UBSN) and Citigroup Inc. (C) trader, and two former RP Martin Holdings Ltd. brokers, Terry Farr and James Gilmour, had been scheduled to enter pleas today. Most of today’s hearing focused on the injunction and another hearing was scheduled for later this year.
The SFO investigations are continuing and Cooke said all of the 22 may be cleared of any wrongdoing.
An official copy of the indictments that will be submitted to the court in the coming weeks probably won’t contain the names of the 22 individuals, lawyers for the SFO said.
Hayes was charged by U.S. authorities in December, in an indictment that was unsealed on the day UBS was fined about $1.5 billion by U.S., U.K. and Swiss regulators for trying to rig global interest rates.
Rabobank Groep, the Netherlands’ biggest mortgage lender, may reach a settlement with regulators as soon as this month over claims it rigged Libor, making it the fifth firm to be penalized over the scandal.
Hendrik Jan Eijpe, a spokesman for Utrecht, Netherlands-based Rabobank, declined to comment.
Global regulators have fined UBS, Barclays Plc, Royal Bank of Scotland Group Plc (RBS) and, most recently, ICAP, about $2.6 billion for distorting Libor and similar benchmarks.
Deutsche Bank AG, Europe’s biggest investment bank by revenue, is interviewing about 50 employees as it investigates whether traders tried to rig benchmark interest rates, said a person with knowledge of the matter.
The interviews are part of an investigation that has included conversations with staff and a review of their electronic communication that started after the Frankfurt-based bank’s management was informed in 2011 of potential attempts to manipulate rates, said the person, who asked not to be identified as they aren’t authorized to speak publicly.
Deutsche Bank declined to comment on its investigation. Germany’s largest lender has said that its probe indicates no wrongdoing by current or former management board members and that it would fire or suspend employees who acted inappropriately without identifying individuals.
Hayes was charged by the SFO in June with conspiring with employees of JPMorgan Chase & Co., Royal Bank of Scotland Group, HSBC Holdings Plc, Rabobank and Deutsche Bank, as well as Tullett Prebon Plc, ICAP (IAP) and RP Martin Holdings Ltd., to manipulate yen Libor rates over a four-year period.
Farr and Gilmour became the first brokers to be prosecuted over the interest-rate benchmark in July when they were charged with conspiracy to defraud.
In addition, four other people have been charged in the U.S. Three former ICAP employees, Darrell Read, Daniel Wilkinson and Colin Goodman, and a former UBS trader, Roger Darin, have been charged by U.S. prosecutors.
Read, Wilkinson and Goodman were charged in September. Darin was charged with Hayes by U.S. authorities in December.
More than $300 trillion of loans, financial products and contracts are linked to Libor. Regulators are looking at how derivative traders and bankers who submitted interest-rate data colluded to ensure benchmarks benefited their own trades, and whether lenders low-balled submissions in 2008 to hide their true cost of borrowing.
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