Britain’s Serious Fraud Office (SFO) is set to press criminal charges against Thomas Hayes, a former Citigroup and UBS trader, for his alleged role in rigging the global Libor rate.
Hayes and two employees of the interdealer broker RP Martin were arrested last December. The move will also allow the SFO to stake a jurisdictional claim to a British suspect who has faced possible extradition since US prosecutors charged him last year.
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Regulators alleged that Hayes and others made thousands of unlawful requests to colleagues to submit false Libor rates, colluding with other banks and at least five interdealer brokers to spread false information and influence others.
The investigation, which began since the scandal came to light in 2008, has brought several global financial institutions under the regulators’ scanner for their alleged roles in manipulating the Libor and other global benchmark interest rates.
Three banks have already faced civil penalties for seeking to influence the Libor rate, with UBS agreeing a record US$1.5 billion penalty to settle US and UK charges.
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By GlobalDataRe-focusing on Libor
On 13 June, Britain’s financial watchdog, Financial Conduct Authority (FCA), said that it is gathering information on potential manipulation of benchmark foreign-exchange rates, amid new allegations that traders at banks are rigging rates to maximise profits.
Earlier in June, reports emerged that the European Union may move Libor oversight to the European Securities and Markets Authority (ESMA) from UK, stripping London of its control over Libor lending rates.
Countries running Libor, Euribor or other "critical union benchmarks" would be under the direct supervision of ESMA, the FT reported, citing a draft copy of the European Commission’s proposal.
Though it may not be passed into law before next year’s European parliamentary elections, the FT report said the regulation is due to be published this summer.
There were also media reports about Barclays and Deutsche Bank potentially facing fresh allegations about Libor-rigging in a court hearing set for October.
