Wednesday, April 17, 2024

Sixth Ex-Broker Cleared in London Libor Trial


Clockwise, from top left, former brokers Darrell P. Read, Danny M. Wilkinson and Colin J. Goodman, all formerly of ICAP; Terry J. Farr and James A. Gilmour, formerly of RP Martin; and Noel Cryan, formerly of Tullett Prebon.

Matt Dunham/Associated Press, Neil Hall/Reuters, Lefteris Pitarakis/Associated Press, Neil Hall/Reuters, Toby Melville/Reuters and Neil Hall/Reuters

LONDON — A sixth former broker was acquitted on Thursday of charges that he helped a onetime trader at UBS and Citigroup manipulate an important benchmark interest rate known as Libor.

A jury at Southwark Crown Court in London found Darrell P. Read, who worked at the British financial firm ICAP, not guilty on the one remaining conspiracy count that he faced.

The jury reached a so-called majority verdict, in which at least 10 members had to vote to acquit, after it was unable to reach a unanimous decision the day before.

On Wednesday, the jury acquitted five other former brokers who worked at the British financial firms RP Martin and Tullett Prebon, as well as ICAP, of all charges and acquitted Mr. Read on a separate count of conspiracy to defraud, which came just a day after the jury began deliberating.

The verdicts represent a severe blow to the reputation of British authorities, who have been criticized for their inability to successfully prosecute financial crimes, particularly when compared with the United States Justice Department.

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Tracking the Libor Scandal

Abuse of interest rates and the failure to address the problem is one of the most expensive scandals to hit Wall Street since the financial crisis.

After the first acquittals on Wednesday, David Green, the director of the Serious Fraud Office, which brought the criminal case, insisted that the prosecution should have been pursued.

“Nobody could sensibly suggest that these charges should not have been brought and considered by a jury,” he said in a statement on Wednesday.

Prosecutors had accused the former brokers of helping Tom Hayes, a former trader at UBS and Citigroup, and others profit by rigging the London interbank offered rate, or Libor. The rate helps determine the borrowing costs for trillions of dollars in loans.

At a separate trial, Mr. Hayes was convicted in August of conspiracy to defraud. In December, a British appeals court reduced his sentence to 11 years in prison from an original term of 14 years.

Mr. Hayes was the first person to go on trial in Britain over criminal charges related to Libor manipulation, and his case was seen as a bellwether for efforts by British authorities to pursue financial crime.

The two trials have followed a half-decade investigation that has led to billions of dollars in fines and damaged the reputations of some of the world’s biggest banks, including Barclays, the Royal Bank of Scotland, UBS and Deutsche Bank.

A third trial in London of others accused of manipulating Libor is expected to begin as early as next month.

The fraud office has accused 11 other people of manipulating the euro interbank offered rate, another key benchmark interest rate known as Euribor. The first trial related to that investigation is expected next year.

In the United States, the first trial of people accused of rigging Libor ended in the convictions of two former London-based traders in November.

In Britain, the Serious Fraud Office had accused the brokers of helping Mr. Hayes and others try to manipulate submissions of Libor as it related to the Japanese yen by so-called panel banks, financial institutions that are surveyed each day and whose information is used to calculate Libor.

To set Libor and other rates, banks submit the rates at which they would be prepared to lend money to one another, on an unsecured basis, in various currencies and at varying maturities.

The other brokers acquitted in the case are Danny M. Wilkinson and Colin J. Goodman, formerly of ICAP; Terry J. Farr and James A. Gilmour, formerly of RP Martin; and Noel Cryan, formerly of Tullett Prebon.

Mr. Read, called Big Nose, was Mr. Hayes’s main contact at ICAP and served as a link to Mr. Goodman and Mr. Wilkinson, prosecutors said. Mr. Wilkinson, called Sarge, was head of the desk where Mr. Read worked.

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Author: Red

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