Hayes Calls UBS Bonus Structure `An Enigma Wrapped in a Riddle'by and
Tom Hayes responds to efforts to seize seven-bedroom house
Hayes is serving an 11-year sentence for rigging Libor
Tom Hayes, the former trader jailed for rigging Libor, told a London court that UBS Group AG’s bonus structure was "an enigma wrapped in a riddle" as he fights a bid by prosecutors to seize his assets.
"What did Churchill say about Russia? A mystery wrapped in an enigma wrapped in a riddle? That was the UBS bonus structure," said Hayes, in response to questions Wednesday about the correlation between his performance and compensation.
The Serious Fraud Office is seeking to recover at least 2.5 million pounds ($3.5 million) -- the amount of Hayes’s bonuses at UBS and Citigroup Inc. -- which it claims are the proceeds of his efforts to manipulate the London interbank offered rate. The bulk of that is tied up in a seven-bedroom house in Surrey, England, known as the Old Rectory.
The proceedings are being presided over by Justice Jeremy Cooke, the same judge who sentenced Hayes to 14 years in prison in August 2015 for rigging the benchmark interest-rate used in trillions of dollars of derivatives and loans. Cooke’s sentence was later deemed "excessive" and cut by three years on appeal in December.
Hayes, who was diagnosed with Asperger’s syndrome last year, was given permission to sit alongside an aide and take regular breaks due to his difficulty controlling his emotions. Dressed in an ill-fitting cream sweater and glasses, with his hair askew, he placed a photograph of his young son in front of him before answering questions.
Earlier Wednesday, Hayes’s lawyer Christopher Convey questioned why the SFO had made no attempt to separate how much of Hayes’s profits came from his efforts to move Libor and how much he would have received by virtue of his talents as a trader.
Hayes made 250 million to 300 million pounds for UBS between 2006 and 2009. Convey said that any impact from his criminal actions was "at the margins." He cited interviews with the SFO in 2013 where Hayes estimated 5 percent of his profits were derived from Libor-rigging. The SFO rejects that figure, saying the amount was "unquantifiable."
Hayes also told the court he was offered $4.5 million to join Goldman Sachs Group Inc. but turned it down to stay at UBS. The former trader said he was so focused on his job that he didn’t care where he worked, or what he looked like.
"I used to turn up for work with holes in my clothes looking like a tramp," Hayes said. "I didn’t hobnob, I wasn’t political. In fact I was the complete opposite."