Ex-Barclays Trader Says Cash Desk Never Set Libor Independently

  • Ryan Reich into third day of testimony at Libor-rigging trial
  • Two traders accused of rate manipulation in London suit

A former Barclays Plc swaps trader on trial for manipulating a key interest-rate benchmark said he never saw "any evidence" that the cash desk set Libor independently from the bank’s commercial position during a fractious exchange with a prosecution lawyer.

"I didn’t think it was independent, ever," Ryan Reich said Tuesday to prosecutor Emma Deacon, who told him British Bankers’ Association executives had testified it was meant to be. "Who is this person who thought it was independent?"

U.K. prosecutors allege Reich, 35, and colleague Stylianos Contogoulas, 45, conspired with others to manipulate the U.S. dollar London interbank offered rate from 2005 to 2007. Reich is accused of messaging traders on the London cash desk in a bid to influence the bank’s daily submitted rate.

Reich either sent or was copied in on 30 messages in one calendar year to Peter Johnson and Jonathan Mathew, that had a proven effect on the submission on just three occasions, he said.

"I didn’t think it was wrong," said Reich who says he was acting under instructions from his immediate boss, Jay Merchant. "I am only going to continue telling the truth. The point is, it was not wrong."

The Libor dollar rate was determined by a panel of 16 banks asked in a daily poll to estimate how much it would cost them to borrow from each other for different periods. The rate is a key benchmark behind more than $350 trillion in securities, including mortgages.

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