The Brokers LIBOR trial begins.Oct 5, 2015
“This week the trial began for the six brokers who will face prosecution in the global LIBOR investigation. The trial comes more than seven years after U.S. regulators first examined how LIBOR rates were set, and a global investigation which led to 21 individuals charged, some of the world's leading banks being fined around $9 billion and a “complete overhaul” of the regulatory regime. This overhaul included the Financial Conduct Authority (FCA) amending existing legislation to make the setting of LIBOR a “regulated activity” and the creation of two new SIF Controlled Functions for individuals who administer LIBOR. Knowingly or deliberately making false or misleading statements in relation to benchmark-setting has also been made a criminal offence”.
"Whilst the US and UK have had a mutual interest in these trials, it is likely that we will witness key differences in the outcomes, including the possibility of higher conviction rates and longer sentences in the US. This is in part due to the increasing propensity of US defendants to enter into plea bargains rather than risk facing even longer custodial sentences at the conclusion of an unsuccessfully contested trial”.
“Furthermore, compared to the first LIBOR trial, which focused on the more marginal analysis of Tom Hayes' alleged confessions - which were later reneged - this will also be the first real test of the prosecutions' true Libor allegations. The allegations which mirror those rehearsed during Hayes’ trial, are that these brokers conspired with Hayes to help him persuade LIBOR submitters at banks to manipulate the rate that they submitted, in return for financial kickbacks from Hayes.”