* Hayes trial date set for January, 2015
* Gilmour, Farr trial pencilled in for September, 2015
* Plea throws down gauntlet to UK fraud prosecutors
By Kirstin Ridley
LONDON, Dec 17 The first three men to face trial
in connection with a global investigation into a rate-rigging
scandal that has rocked the financial industry pleaded not
guilty in court on Tuesday.
Tom Hayes, a former UBS and Citigroup trader
has been charged with eight counts of conspiring with staff
from at least 10 major banks and brokerages to manipulate Libor
benchmark interest rates between 2006 and 2010.
Farr and Gilmour, former RP Martin brokers who were arrested
alongside Hayes in Britain last December and later also charged
with two and one count of conspiracy to defraud respectively by
Britain's Serious Fraud Office, also pleaded not guilty. All
three are on bail.
The pleas pose a challenge to SFO head David Green, who has
staked his reputation on the success of high-profile
investigations such as the sprawling investigation into the
manipulation of benchmarks such as Libor (London Interbank
U.S. and European authorities have fined 10 banks and
brokerages around $6 billion to date and charged seven men with
criminal offences in connection with the rate-rigging scam.
Regulators are also now investigating how other benchmarks are
set, such as in foreign exchange and swaps markets.
Libor rates, designed to reflect the wholesale cost of
loans, are used to help to price hundreds of trillions of
dollars worth of financial products worldwide, ranging from
derivatives to mortgages.
Prosecutors allege Hayes conspired to defraud with staff of
UBS, Citigroup, JPMorgan, RBS, ICAP,
Tullet Prebon, at least one employee of Deutsche Bank
, Rabobank and HSBC, Farr and Gilmour and
another employee of RP Martin while he worked in Japan.
"They dishonestly agreed to procure or make submissions of
rates ... which were false or misleading in that they were
intended to create an advantage to the trading position of Tom
Hayes and others and deliberately disregarded the proper basis
for the submission of those rates, thereby intending to
prejudice the economic interests of others," the indictment
TRIAL IN 2015
Judge Jeremy Cooke set a trial date for Hayes for January
2015. The trial of Hayes, who last December was also charged
with fraud-related offences by U.S. prosecutors, could take 12
weeks, lawyers said.
The provisional trial date of Farr and Gilmour, which is
expected to take around 6 weeks, has been set for September
2015, in part to allow the SFO time to bring a case against
further alleged co-conspirators.
The SFO's head Green had been hoping to charge more
individuals in connection with the Libor investigation around
UBS, which paid $1.5 billion to U.S. and European regulators
last year to settle Libor-rigging charges - the biggest
Libor-related fine to date - declined to comment as did
Citigroup and ICAP.
RP Martin, Deutsche Bank, Rabobank and JPMorgan also
declined to comment. Tullett Prebon and HSBC did not immediately
respond to requests for a comment.
Hayes joined Swiss bank UBS in Tokyo in 2006, becoming a
senior trader of interest-rate derivatives indexed to
yen-denominated Libor. In late 2009, he left UBS to join
Citigroup in Tokyo. He left the U.S. bank less than a year
While Hayes was at UBS, Farr and Gilmour are alleged to have
conspired with him and other UBS employees, another RP Martin
employee, an employee of Rabobank and one at HSBC, among others,
by trying to influence yen-denominated Libor.
Farr is also charged with conspiring with Hayes and others
while Hayes worked at Citibank.