Ex-Barclays bankers get jail term over Libor rigging

LONDON • Four former Barclays bankers were sentenced to between 33 months and 61/2 years in jail by a London judge yesterday for conspiring to fraudulently rig global benchmark interest rates.

Calcutta-born Jay Merchant, 45, the most senior of the men to face a jury for the case, was sentenced to 61/2 years. The New York-based former derivatives trader was convicted unanimously.

His junior, American Alex Pabon, 38, was sentenced to two years and nine months and junior British Libor submitter Jonathan Mathew, 35, was handed a four-year sentence. Both men were convicted by majority verdict.

Mathew's former boss, 61-year-old Peter Johnson, a 35-year Barclays veteran, was sentenced to four years. The former senior dollar Libor submitter and head dollar cash trader pleaded guilty in October 2014 and did not stand trial.

Judge Anthony Leonard said the men would serve half their sentences in prison and then be released on licence. "What this case has shown is the absence of integrity that ought to characterise banking," he said.

The sentences come four years after Barclays became the first of 11 powerful banks and brokerages to be slapped with a hefty fine for their role in the rate -fixing scandal, sparking a political backlash that forced out former chief executive Bob Diamond, an overhaul of Libor rules and the criminal inquiry.

The sentencing comes a day after the British authorities said they would seek a retrial of two other former Barclays traders after a jury was unable to reach a verdict this week on charges that they plotted to manipulate a benchmark interest rate - Libor.

The jury, which began deliberations on June 20, was unable to reach a verdict regarding former traders Stylianos Contogoulas and Ryan Michael Reich, and was discharged on Monday.

The trial was the third in Britain to focus on a scandal involving the London interbank offered rate. It followed a half-decade investigation that led to billions of dollars in fines and shook the reputations of some of the world's biggest banks, including Deutsche Bank, the Royal Bank of Scotland and UBS.

Barclays, the first bank to reach a settlement in the Libor investigation, paid US$450 million (S$607 million) in penalties.

Meanwhile, US prosecutors dropped a criminal complaint over Libor against three former ICAP brokers after they were acquitted by a British court earlier this year.

The case against Messrs Darrell Read, Colin Goodman and Danny Wilkinson was closed on June 30, according to documents. The decision comes after the men were acquitted in January following a four-month trial with three other brokers from different institutions.

REUTERS, NEW YORK TIMES

A version of this article appeared in the print edition of The Straits Times on July 08, 2016, with the headline 'Ex-Barclays bankers get jail term over Libor rigging'. Print Edition | Subscribe