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Libor trial: Trader kept rate 'artificially high' | Libor trial: Trader kept rate 'artificially high' |
(about 3 hours later) | |
The trader at the centre of the Libor rate-rigging trial tried to influence other banks to manipulate the key benchmark rate to suit his own trading positions, a jury at Southwark Crown Court has heard. | The trader at the centre of the Libor rate-rigging trial tried to influence other banks to manipulate the key benchmark rate to suit his own trading positions, a jury at Southwark Crown Court has heard. |
Tom Hayes allegedly told one trader that he had managed to keep the three-month Libor rate "artificially high". | |
Mr Hayes, 35, a former UBS and Citigroup trader, is facing eight counts of conspiracy to defraud. | Mr Hayes, 35, a former UBS and Citigroup trader, is facing eight counts of conspiracy to defraud. |
He denies the charges. | He denies the charges. |
Mr Hayes is accused of acting in "a thoroughly dishonest manner" in his alleged attempts to rig the benchmark rate. | Mr Hayes is accused of acting in "a thoroughly dishonest manner" in his alleged attempts to rig the benchmark rate. |
On the second day of the trial, the jury was presented with electronic and audio conversations between Mr Hayes and fellow traders. | On the second day of the trial, the jury was presented with electronic and audio conversations between Mr Hayes and fellow traders. |
In one of the electronic conversations submitted to the jury, Mr Hayes is allegedly discussing manipulating the Libor rate with Will Hall, a trader at RBS, in February 2007. | In one of the electronic conversations submitted to the jury, Mr Hayes is allegedly discussing manipulating the Libor rate with Will Hall, a trader at RBS, in February 2007. |
Mr Hayes said: "Three-month Libor is too high, 'cos I've kept it artificially high." | Mr Hayes said: "Three-month Libor is too high, 'cos I've kept it artificially high." |
He said he had managed to do this by "being mates with the cash desks - [JP Morgan] Chase and I always help each other out". | He said he had managed to do this by "being mates with the cash desks - [JP Morgan] Chase and I always help each other out". |
Prosecuting QC Mukul Chawla QC said: "If you ever needed any evidence of deliberate rigging of rates, this is it. | Prosecuting QC Mukul Chawla QC said: "If you ever needed any evidence of deliberate rigging of rates, this is it. |
"This is strategic, isn't it. It's nothing to do with the bank's borrowing rates. It's all to do with Mr Hayes' trading positions." | "This is strategic, isn't it. It's nothing to do with the bank's borrowing rates. It's all to do with Mr Hayes' trading positions." |
'On the low side' | 'On the low side' |
The jury was also played a short telephone conversation between Mr Hayes and his stepbrother, Peter O'Leary, who had recently joined the bank HSBC. | The jury was also played a short telephone conversation between Mr Hayes and his stepbrother, Peter O'Leary, who had recently joined the bank HSBC. |
In the conversation, Mr Hayes can be heard asking Mr O'Leary to persuade the HSBC person submitting the yen Libor rate to keep it "on the low side" for a few days. | In the conversation, Mr Hayes can be heard asking Mr O'Leary to persuade the HSBC person submitting the yen Libor rate to keep it "on the low side" for a few days. |
This would allegedly help with Mr Hayes' trading positions. | This would allegedly help with Mr Hayes' trading positions. |
In another exchange with a trader at a different bank, Mr Hayes allegedly wrote: "Do me a huge favour and ask the cash guys to set one-month Libor low for the next few days. I will return the favour." | In another exchange with a trader at a different bank, Mr Hayes allegedly wrote: "Do me a huge favour and ask the cash guys to set one-month Libor low for the next few days. I will return the favour." |
Mr Chawla said this was evidence of a culture of "you scratch my back, I'll scratch yours" that Mr Hayes developed with other banks. | Mr Chawla said this was evidence of a culture of "you scratch my back, I'll scratch yours" that Mr Hayes developed with other banks. |
On Tuesday, Mr Chawla accused Mr Hayes, a former UBS and Citigroup trader, of being motivated by "greed" and acting as the "ringmaster" in an enormous fraud to rig the benchmark interest rate. | On Tuesday, Mr Chawla accused Mr Hayes, a former UBS and Citigroup trader, of being motivated by "greed" and acting as the "ringmaster" in an enormous fraud to rig the benchmark interest rate. |
Libor - the London Interbank Offered Rate - is an interest rate used by banks around the world to set the price of financial products worth trillions of pounds. | Libor - the London Interbank Offered Rate - is an interest rate used by banks around the world to set the price of financial products worth trillions of pounds. |
Mr Hayes, 35, from Fleet, Hampshire was first arrested in 2012 before being formally charged in June 2013 with eight counts of conspiracy to defraud over the period 2006 to 2010. | Mr Hayes, 35, from Fleet, Hampshire was first arrested in 2012 before being formally charged in June 2013 with eight counts of conspiracy to defraud over the period 2006 to 2010. |
The trial continues at Southwark Crown Court. | The trial continues at Southwark Crown Court. |
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