Hayes ‘Didn't Invent’ Libor Rigging, Lawyer Says in Appeal Fight

  • Lawyer for Hayes says 14-year sentence was too harsh
  • Judges may issue ruling on conviction, sentence next week

A lawyer for Tom Hayes questioned the 14-year prison sentence issued to the former UBS Group AG trader, saying the trial judge didn’t give enough weight to the fact that Libor rigging started before Hayes got to the bank and it continued after he moved on.

Neil Hawes asked a London court to cut the sentence, one of the longest ever given to a non-violent criminal in the U.K. Hawes also said that Hayes should be given special consideration because he was diagnosed with Asperger’s syndrome.

"The judge should have considered Hayes’s responsibility within the bank," Hawes said Wednesday. "He didn’t invent" Libor-rigging.

Hayes was the public face of one of the biggest global banking scandals even before August, when was he convicted of rigging the London interbank offered rate -- the benchmark used to value more than $350 trillion of financial contracts from mortgages to student loans. A dozen banks and brokerages have been fined about $9 billion for Libor manipulation by regulators around the world.

The 36-year-old trader, who is in a Nottingham prison, didn’t attend the two-day hearing. The first day of the hearing Tuesday focused on Hayes’s motion to overturn the conviction before moving on to sentencing issues this afternoon.

Hawes also questioned whether the harsh sentence will serve as any sort of a deterrent as regulators are now closely scrutinizing Libor rates.

But Justice Brian Leveson, who on Tuesday compared Hayes’s arguments to politicians who cheat on their expenses, said that the sentence sent a wider message to the financial industry beyond Libor.

"What has to be deterred within the banking community is conduct that ordinary people would think is dishonest," he said. "It doesn’t matter if Libor is resolved."

A ruling in the appeal could be issued as soon as next week to give clear guidance in two other criminal cases tied to Libor.

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