Prosecutors in the United Kingdom are charging three ex-Barclays Plc (ADR) employees with conspiring to manipulate the London interbank offered rate. The Serious Fraud Office charged Jonathan James Mathew, Peter Charles Johnson, and Styilianos Contogoulas with conspiring to defraud. These are the first criminal charges involving the manipulation of the US dollar Libor.
Over a dozen firms are under investigation by regulators and prosecutors around the world over collusion in rigging the London interbank offered rate and related benchmarks. Mathew and Johnson were employed by Barclays, the first firm fined ($450 million) over Libor by UK and US authorities two years ago, between 2001 through September 2012. Contogoulas, who worked with Barclays from 2002 through 2006, was with Merrill Lynch (MER) after that through September 2012.
Previous to the allegations against Contogoulas, Johnson, and Mathew, criminal charges against persons in the UK and the US solely had involved an alleged rate-manipulating ring led by trader Tom Hayes, a former Citigroup Inc. (C) and UBS AG (UBS) employee. He pleaded not guilty to US charges. With this latest criminal case against the three men, 13 individuals now face criminal cases in the UK probe into Libor.
Also, the Wall Street Journal is reporting that the SFO is also expected to file charges against three ex-ICAP (IAP) PLC brokers for allegedly assisting traders to manipulate rates. Colin Goodman, Daniel Wilkinson, and Darrell Read already have been charged with fraud over related charges in the US. All three of them live abroad.
In September, the US Justice Department charged the ex-ICAP employees with wire fraud and conspiracy to commit wire fraud related to manipulating benchmark interest rates with Hayes and other traders, “undermining financial markets” globally, and compromising the integrity of interest rate benchmarks. The three men earned larger bonus checks in the process from the alleged misconducts.
Meantime, other alleged Libor manipulation rings remain under investigation.
Charges Open New Front in Libor Probe, The Wall Street Journal, February 17, 2014
Former Barclays Employees Charged Over Libor Rigging, Bloomberg, February 18, 2014
ICAP Brokers Face Felony Charges for Alleged Long-Running Manipulation of LIBOR Interest Rates, DOJ.gov, September 25, 2013
More Blog Posts:
Deutsche Bank, Royal Bank of Scotland Settle & Others for More than $2.3B with European Union Over Interbank Offered Rates, Institutional Investor Securities Blog, December 24, 2013
Fannie Mae Sues UBS, Bank of America, Credit Suisse, JPMorgan Chase, Citigroup, & Deutsche Bank, & Others for $800M Over Libor, Institutional Investor Securities Blog, December 14, 2013
SEC Charges Two Wall Street Traders With Securities Fraud in “Parking” Scam, Stockbroker Fraud Blog, February 15, 2014