City trader jailed for 14 years for helping to rig Libor interest rates
A “GREEDY” City trader has become the first man to be jailed for rigging Libor rates in a scandal that shook financial markets.
Tom Hayes, 35, has been handed a 14-year prison term for his role as the “ringmaster” in an enormous fraud to manipulate the benchmark interest rates.
Sentencing him at London’s Southwark Crown Court, Mr Justice Cooke said: “What this case has shown is the absence of that integrity which ought to characterise banking.
“You, as a regulated banker, succumbed to temptation in an unregulated activity because you could.”
Hayes, a highly-paid ex-trader at UBS and Citigroup, orchestrated a scheme to interfere with the rate to boost his own six-figure earnings.
In an audio clip he said “influencing” Libor was “commonplace” and admitted he was a “serial offender”.
Hayes, of Fleet, Hampshire, was found guilty of eight counts of conspiracy to defraud covering a period from 2006 to 2010, when he worked f or UBS and Citigroup.
The judge said: “You played a leading role in the manipulation of Libor.
“You exerted pressure on others, essentially trained those junior to you in the activit y, made corrupt payments to brokers for their assistance.
“The reputation of Libor is important to the City, as a financial sector, and the banking institutions of this City. Probity and honesty is essential, as is trust.”
A string of banks, includ- ing Barclays, Lloyds Banking Group, Royal Bank of Scotland and Deutsche Bank, have been fined billions of pounds for their part. Dozens of traders have been fired and one person, whose name and bank cannot be reported, has pleaded guilty to their role.
Described by Mr Justice Cooke as “by nature a gambler”, Hayes told investigators after his arrest in December 2012: “You want every little bit of money you can possibly get.”
But the judge said it was no excuse to claim other traders were also manipulating Libor and added: “The fact that others were doing the same as you is no excuse. Nor is the fact that your managers saw the benefits of what you were doing and condoned it, embraced it, even encouraged it.”
Hayes worked for Royal Bank of Scotland and Royal Bank of Canada before joining UBS in 2006 as a trader in Tokyo. He was paid £1.3m before tax in salary and incentives by UBS from September 2006 to December 2009.