N.Y. Barclays Libor Traders Said to Face U.K. Charges

Three Barclays Plc Libor traders in New York were notified by U.K. prosecutors that they may be charged for allegedly manipulating the interest-rate benchmark, according to four people with knowledge of the situation.

Ryan Reich, Alex Pabon and Jay Merchant are under investigation by the SFO and may be prosecuted in connection with suspected rigging of the dollar London interbank offered rate, or Libor, said two of the people, who asked not to be named because the investigation is private. All were derivatives traders who have left Barclays.

The SFO has sought to interview a number of former Barclays traders in the U.S. and U.K. regarding Libor manipulation in recent months, Bloomberg reported in January. Three former London-based Barclays traders were charged by the SFO last week.

These would be the first U.S.-based individuals charged in the British probe. Most of the eight people charged by U.S. authorities in their rate-rigging investigations worked in the U.K. Global enforcement agencies are investigating whether more than a dozen firms colluded to manipulate the rate, with about $6 billion in fines levied to date.

The three didn’t immediately respond to e-mails seeking comment. Reich didn’t respond to a message left on his work telephone and there was no answer at a phone number listed for Pabon. Merchant’s phone number wasn’t immediately available. Nilima Fox, a spokeswoman for the SFO, declined to comment. Giles Croot, a spokesman for London-based Barclays, declined to comment.

Others Charged

Former Barclays traders Peter Charles Johnson, Jonathan James Mathew and Stylianos Contogoulas were charged this month in London with conspiracy to defraud related to Libor. The three conspired with “other employees of Barclays Plc and its associated entities” to defraud with intent to “prejudice the economic interests of others,” prosecutors said in court documents.

“Naturally, we don’t accept for one moment the characterization of the facts as portrayed by the SFO,” said Hugo Keith, a lawyer for Johnson, at a court hearing this week.

Three former employees of other financial firms will stand trial next year for yen Libor manipulation.

Barclays was the first to be fined over Libor with a record 290 million-pound ($482 million) penalty by U.S. and U.K. regulators in June 2012. As part of that decision, the bank admitted to submitting false figures for Libor and Euribor, the Euro interbank offered rate.

Barclays has been assisting with the investigations into other firms and individuals, and was the first to provide “extensive and meaningful cooperation” to the U.S. government, the Justice Department said when the fine was announced.