LONDON (Reuters) - Tom Hayes, the first trader to face a jury trial over alleged Libor rate-rigging offences, told British investigators brokers in other firms became "a tool in my armoury" when they offered to help move rates for him, a London court heard on Wednesday.
The former UBS and Citigroup trader, on trial at Southwark Crown Court, also told investigators from Britain's Serious Fraud Office (SFO) that market abuse had been rife and that senior UBS managers must have known what was going on.
UBS bosses including Carsten Kengeter, former co-chief executive of UBS's investment bank, attended at least one morning meeting in Tokyo at which traders commonly discussed Libor rates, and where people wanted them set to flatter trading positions, Hayes told the SFO, the court heard.
"It was too widespread and open for people to be completely unaware ... It was just so blatant," he told investigators during 82 hours of recorded interviews while he was initially co-operating with the SFO in return for admitting wrongdoing, six weeks after his arrest in December 2012.
Hayes also said his ex-line manager Mike Pieri was aware of extra payments he was making to brokers and his network of friends at other banks, in return for information and help, because he said he was "very open about it", the court heard.
Hayes, 35, is charged with eight counts of conspiracy to defraud, a criminal offence that carries a maximum jail sentence of 10 years, between August 2006 and September 2010.
The former yen derivatives trader, who was based in Tokyo until 2010, has pleaded not guilty. His legal team is expected to lay out his defence next month in a trial scheduled to last well into August.
Hayes, described as a highly intelligent and successful trader by prosecutors, told investigators of a culture of heavy drink and drug use in Tokyo during his time there, which he felt at odds with.
Hayes, who has been diagnosed with mild Asperger's, a form of autism, told investigators he preferred to "get home and have an orange juice and be boring".
The SFO alleges Hayes was a central figure in a conspiracy with 25 staff from at least 10 banks and brokerages to rig Libor, the London interbank offered rate, used to price an estimated $450 trillion of financial contracts from derivatives to loans for households and individuals worldwide.
Prosecutors allege Hayes was driven by greed when he used a network of traders and brokers and conspired to persuade, cajole, threaten or simply request "false" rates to benefit his own trading book, prejudicing the economic interest of others.
Hayes joined Swiss-based UBS in Tokyo in 2006 aged 27 and quickly became a respected and well-paid senior trader. He was poached by US-based Citigroup in Tokyo in 2009.
But he held that job for barely 10 months before he was fired after a colleague complained about his trading methods and Citigroup launched an internal investigation into Libor trading. He returned to England and was arrested in December 2012.
According to court documents shown to the jury by prosecutors, Hayes initially cooperated with the SFO and, over six months, not only made "complete confessions" but also offered evidence against a large number of other people, including his own step-brother.
"I probably deserve to be sitting here because, you know, I made concerted efforts to influence Libor," he was quoted as telling investigators.
But Hayes later changed his legal team and in October 2013, his new lawyers wrote to the SFO to say he was withdrawing cooperation, prosecutors have told the court.
His leading lawyer Neil Hawes, cross examining an SFO investigator, showed to the jury notes in which Hayes's lawyers expressed concerns about their client being extradited to the United States, where the Department of Justice was also investigating his alleged role in rigging Libor.
Favouring open-necked shirts and jumpers in court, Hayes, who was given leave to sit with his legal team, has taken copious notes, passing some to his senior legal team, and has frowned, gesticulated or shaken his head at prosecutor and witness allegations.