Former UBS trader charged over Libor rate-rigging scandal

PUBLISHED : Wednesday, 19 June, 2013, 12:00am
UPDATED : Wednesday, 19 June, 2013, 8:32am


British officials charged former UBS trader Tom Hayes yesterday, marking the first prosecution over the Libor rate-rigging scandal which rocked the banking sector last year with repercussions across the world.

"Tom Hayes, a former trader at UBS and Citigroup, has been charged with offences of conspiracy to defraud in connection with the investigation by the Serious Fraud Office into the manipulation of Libor," the Serious Fraud Office said.

It said Hayes was charged by London police with eight counts of conspiracy to defraud. It was not clear whether the charges related to his time at Swiss bank UBS and/or US rival Citigroup.

In December, British, Swiss and US regulators fined UBS 1.4 billion Swiss francs (HK$11.8 billion) for manipulating the Libor interbank lending rate which determines financial and interest rate contracts worldwide.

The latest twist in the scandal comes after the British Bankers' Association last week announced changes to Libor interest-rate transparency in a bid to avoid a repeat of the damaging affair.

It said publication of banks' individual submissions of the Libor interbank lending rate would be embargoed for three months in a move aimed at avoiding renewed manipulation of the borrowing cost as occurred in the past. It added that the change, which followed recommendations of a review initiated by the British government, would take effect from July 1.

The Libor scandal erupted last year when Barclays bank was fined £290 million (HK$3.51 billion) by British and US regulators for attempted manipulation of Libor and Euribor interbank rates between 2005 and 2009.