Regulation  

US and UK collaborate to charge individuals over Libor fix

An FCA spokesman said: “We have said before we are investigating a number of firms and a number of individuals and that hasn’t changed. We will continue to work with the SFO and other regulators.”

A spokesman for the SFO confirmed: “Our investigation continues apace and we have so far charged three people. Further developments are expected in the coming months.”

The three people the SFO has charged are former UBS trader Tom Hayes (charged on 18 June), and Terry Farr and James Gilmour (charged on 15 July).

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On 30 July, Mr Farr and Mr Gilmour, both ex-employees of UK interbroker dealer RP Martin, appeared at Southwark crown court after being charged with conspiracy to fraud.

It was alleged that the trio plotted with employees at firms including UBS, HSBC, Rabobank, Citi and Tullett Prebon to dishonestly influence the yen London interbank offered rate between August 2006 and December 2009.

The three men will next appear at Southwark for a plea and case management hearing on 21 October.

Last week, investigations into Icap carried out in the US and London also saw three traders charged by the Justice Department for alleged long-running manipulation of the yen Libor rate.

According to a statement from the Federal Bureau of Investigations, the three men are Darrell Read, who is living in New Zealand, and Brits Daniel Wilkinson and Colin Goodman, who are all former Icap brokers.

Mythili Raman, acting assistant attorney general of the Justice Department’s criminal division, said: “These three men are accused of repeatedly and deliberately spreading false information to banks and investors around the world to move the market.”

A trial date is yet to be revealed.

This came as the US Commodity Futures Trading Commission imposed a fine of $65m on Icap, while the FCA fined the British brokerage firm a further £14m.

According to the FCA notice, Icap’s misconduct breached the regulator’s Principles for Businesses, involved “a significant number of brokers”, including two managers, and occurred over a number of years. It said the misconduct also included a broker receiving corrupt bonus payments (at the instigation of one manager) as a reward for his assistance in manipulating the yen/Libor rates.

Icap agreed to settle at an early stage of the investigation and therefore qualified for a 30 per cent discount under the FCA’s settlement discount scheme. Without the discount, the fine would have been £20m.

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Michael Spencer, group chief executive officer for Icap and Tory party donor, said: “We deeply regret and strongly condemn the inexcusable actions of the brokers who sought to assist certain bank traders in their efforts to manipulate yen/Libor.

“Their conduct contravenes all that Icap stands for. None of the three individuals at the centre of the activity remains with the firm. Others are either no longer with the company or are being disciplined.

“There were no findings that any senior management were involved in this matter nor that the firm engaged in deliberate misconduct.”