The highly anticipated trial of six British brokers accused of helping Tom Hayes, the former trader that was called the “ringmaster” behind the LIBOR fixing scandal, started this week.
LIBOR — or the London interbank offered rate — is the daily measure meant to show the rate at which banks will lend to each other and is used to set the price of hundreds of trillions of dollars worth of financial products.
The scandal of traders and brokers rigging the rate to benefit their own trades was uncovered in 2012, but Hayes is so far the only person to be jailed for LIBOR rigging.
Former ICAP brokers Darrell Read, Colin Goodman, and Danny Wilkinson, ex-brokers from RP Martin Terry Farr and James Gilmour, and Noel Cryan of Tullett Prebon, all faced the judge in Southwark Crown Court in London on Tuesday.
The Serious Fraud Office charged the men with a total of five counts of conspiracy to defraud by trying to move the rate linked to the Japanese yen. If the jury finds them guilty, they could face up to 10 years in prison. All have pleaded not guilty.
“They were rewarded in various ways to corrupt a process that should not have been corrupted,” said the Mukul Chawla QC, prosecuting, according to the Financial Times.
Authorities allege the men helped Hayes, the former UBS and Citi trader, who was jailed for 14 years after being found guilty of rigging LIBOR.
The FT reported that the prosecution called Hayes the “central figure” who sought to manipulate the brokers. Therefore, “each of these six defendants was essentially helping him to cheat those who he had entered into trades with.”
The prosecution also clarified which brokers had nicknames in order to identify them in conversation transcripts.
Read, who was allegedly Hayes’s primary contact, was known as “Big Nose.” Goodman was known as “Lord Libor” while Wilkinson was known as “Sarge.”
The trial is expected to last 12-14 weeks. The prosecution will wrap up its case in mid-November. The defence then starts its case immediately after that.