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Libor trial: Tom Hayes claims he made confession to avoid US extradition Libor trial: Tom Hayes claims he made confession to avoid US extradition
(about 14 hours later)
Tom Hayes, the former City trader fighting criminal charges for manipulating Libor, said he originally confessed to misconduct in 2013 after being “frozen with fear” that he would be extradited to America.Tom Hayes, the former City trader fighting criminal charges for manipulating Libor, said he originally confessed to misconduct in 2013 after being “frozen with fear” that he would be extradited to America.
The 35-year-old told Southwark crown court that he exaggerated statements to the UK’s Serious Fraud Office (SFO), when admitting influencing the benchmark interest rate, in order to avoid a long prison sentence in the US.The 35-year-old told Southwark crown court that he exaggerated statements to the UK’s Serious Fraud Office (SFO), when admitting influencing the benchmark interest rate, in order to avoid a long prison sentence in the US.
He added that he did not believe he had acted dishonestly with regard to Libor and that he wanted to do his job “as perfectly” as he could.He added that he did not believe he had acted dishonestly with regard to Libor and that he wanted to do his job “as perfectly” as he could.
Giving evidence for the first time, Hayes told the court on Tuesday how he was “petrified” after his arrest: “I went crazy. I was frozen with fear.” Giving evidence for the first time, Hayes told the court on Tuesday how he was “petrified” after his arrest: “I went crazy. I was frozen with fear.
“The only consideration was getting charged and avoiding extradition. I didn’t think about innocence or guilt.”“The only consideration was getting charged and avoiding extradition. I didn’t think about innocence or guilt.”
He told the jury that he had been desperate to stay in Britain in order to remain with his wife and child and had therefore attempted to get charged by British prosecutors, ensuring that he would have to face trial in the UK. He told the jury that he had been desperate to stay in Britain to remain with his wife and child and had therefore attempted to get charged by British prosecutors, ensuring that he would have to face trial in the UK.
The former yen derivatives trader denies eight counts of conspiracy to defraud between 2006 and 2010, when he worked for Swiss bank UBS and America’s Citigroup. Each count carries a sentence of up to 10 years in prison.The former yen derivatives trader denies eight counts of conspiracy to defraud between 2006 and 2010, when he worked for Swiss bank UBS and America’s Citigroup. Each count carries a sentence of up to 10 years in prison.
Shortly after he was arrested in 2012, it emerged that US prosecutors also wanted to charge Hayes on three counts, with each one carrying a 20 to 30-year sentence.Shortly after he was arrested in 2012, it emerged that US prosecutors also wanted to charge Hayes on three counts, with each one carrying a 20 to 30-year sentence.
Previously, the court has been read sections of a transcript of Hayes’ “scoping interviews” with SFO officers, in which he answered “yes” to the question: “Do you admit that you acted dishonestly in the manipulation and attempted manipulation of submissions bring made for Libor?”Previously, the court has been read sections of a transcript of Hayes’ “scoping interviews” with SFO officers, in which he answered “yes” to the question: “Do you admit that you acted dishonestly in the manipulation and attempted manipulation of submissions bring made for Libor?”
Neil Hawes QC, acting in Hayes’ defence, asked the former trader if he accepted acting dishonestly in relation to Libor.Neil Hawes QC, acting in Hayes’ defence, asked the former trader if he accepted acting dishonestly in relation to Libor.
“No, I don’t accept that,” Hayes responded.“No, I don’t accept that,” Hayes responded.
Hayes added that while he had influenced Libor, he had done so to suit his bank’s commercial objectives, and that the practice was widespread within the financial services industry.Hayes added that while he had influenced Libor, he had done so to suit his bank’s commercial objectives, and that the practice was widespread within the financial services industry.
“There’s a reason banks want to be on the [Libor rate setting] panel,” Hayes said. “Because it allowed them to make commercially favourable submissions.“There’s a reason banks want to be on the [Libor rate setting] panel,” Hayes said. “Because it allowed them to make commercially favourable submissions.
“There was an ethos – what is best for the bank? How do we make the best submission?”“There was an ethos – what is best for the bank? How do we make the best submission?”
Libor – which stands for the London Interbank Offered Rate – was set by a panel of “submitter” banks which had to estimate what they would charge each other for borrowing in different currencies and timescales. The rate underpinned many financial products and so affected the profitability of a bank’s overall business – with small movements in the rate potentially translating into much larger profits or losses for Hayes and his fellow traders.Libor – which stands for the London Interbank Offered Rate – was set by a panel of “submitter” banks which had to estimate what they would charge each other for borrowing in different currencies and timescales. The rate underpinned many financial products and so affected the profitability of a bank’s overall business – with small movements in the rate potentially translating into much larger profits or losses for Hayes and his fellow traders.
Hayes, who knew Libor setters but was never on the panel himself, worked for Royal Bank of Scotland and Royal Bank of Canada before joining UBS in 2006 as a trader in Tokyo.Hayes, who knew Libor setters but was never on the panel himself, worked for Royal Bank of Scotland and Royal Bank of Canada before joining UBS in 2006 as a trader in Tokyo.
He joined Citi in 2009 and continued working in Tokyo, where he traded in yen-denominated derivatives tied to Libor. He was sacked after his methods were reported to senior management and then arrested in December 2012 by the SFO after returning to the UK.He joined Citi in 2009 and continued working in Tokyo, where he traded in yen-denominated derivatives tied to Libor. He was sacked after his methods were reported to senior management and then arrested in December 2012 by the SFO after returning to the UK.
Hayes was diagnosed in May by an independent medical expert with mild Asperger syndrome, which is a form of autism. He has been allowed to sit with an independent intermediary while being cross-examined. In May, Hayes was diagnosed with mild Asperger syndrome, a form of autism, by an independent medical expert. He has been allowed to sit with an independent intermediary while being cross-examined.