Three men including former UBS trader held in first British arrests over Libor interbank rate rigging probe
Men aged 33, 41 and 47 taken to London police stationOne is a former UBS trader
The three arrests follow searches in Surrey and Essex
SFO opened Libor probe in July after big Barclays fine
10:08 GMT, 12 December 2012
One of the three men arrested in connection with an investigation into the rigging of the interbank lending rate Libor was an ex-trader who worked for UBS and the other two were interdealer brokers, a report said today.
The British men – aged 33, 41 and 47 – were taken to a London police station after searches at a property in Surrey and two premises in Essex.
They were named today as Tom Hayes, a former trader, and Terry Farr and Jim Gilmour – both employees of a London-based interdealer broker.
Arrests: The Serious Fraud Office building in central London is pictured. The Government department investigates and prosecutes serious and complex fraud
Mr Hayes, 33, who has worked in London and Tokyo and
who specialised in products pegged to yen-dominated Libor, was taken to
Bishopsgate police station yesterday following a search of his home, the
Financial Times reported.
Mr Farr and Mr Gilmour, two employees of RP Martin, a London-based
interdealer broker, and believed to be known to Hayes, were also
questioned, the newspaper said.
The Serious Fraud Office opened its
investigation into Libor manipulation in July after Barclays was fined
290million by U.S. and UK regulators.
The bank had rigged the key lending rate which affects mortgages and loans. Other banks are also subject to investigation.
At the height of the banking scandal
this summer, the SFO revealed it had been working closely with the
Financial Services Authority.
The Government department, which investigates and prosecutes serious and complex fraud,
launched an inquiry into the entire banking sector.
It came after a number of traders at
Barclays were found to have rigged Libor to boost profits and bonus
The bank was also accused of lowering submissions in a
bid to alter the perception of the lender’s finances.
The claims ultimately led to the
resignation of Barclays boss Bob Diamond and sparked a criminal
They also became the focal point of a bitter row in Westminster
over ethics in the banking sector.
Investigation prompt: Barclays was fined 290million by US and UK regulators for rigging the key lending rate which affects mortgages and loans
The arrests follow speculation that Swiss banking giant UBS has started settlement talks with regulators over alleged Libor rigging.
UBS is reportedly on course to reach an agreement before Christmas and is facing a fine of more than 280million.
Around 20 financial institutions have been investigated over the alleged rigging of benchmark interest rates which govern 300trillion of contracts.
These range around the world from household mortgages to complex derivatives products.
Taxpayer-backed Royal Bank of Scotland has previously said it hopes to settle any Libor claims soon and warned potential penalties could be huge.
Focus on the banking sector intensified as HSBC revealed a 1.2billion settlement for failing to comply with anti-money laundering rules.
Standard Chartered also paid out an additional 203million over allegations that it breached sanctions with Iran.