Five former Barclays employees have been accused of conspiring to defraud, by fixing the Libor interest rate.Jonathan James Mathew, 35, Stylianos Contogoulas, 44, Jay Vijay Merchant, 45, Alex Pabon, 37, and Ryan Reich, 34, are accused of manipulating the rate between 1 June 2005 and 31 August 2007.
The prosecution told the court that “they were driven by money… to make more profit on their trading”.
The five defendants deny one count of conspiracy to defraud.
The court also heard that the financial position of every company, every government, perhaps every household was directly or indirectly sensitive to Libor in one way or another.
The trial at Southwark Crown Court, which began on Tuesday, is expected to last 12 weeks.
Global rate
Prosecution counsel James Hines QC said that to maximise their profits, the defendants agreed to manipulate or rig the US dollar Libor rate to the advantage of their trades and to the disadvantage of the people who they were doing trades with.
Submitters, who contributed to the setting of the Libor rate by revealing the interest rates at which their banks were willing to lend at, were told if the traders wanted the rate to go up or down, the prosecution alleged.
Libor – the London interbank offered rate – is an interest rate used by banks around the world to set the price of financial products worth trillions of pounds.
The ability to organise even minor movements in the rate had the potential to generate bumper profits for a trader.
Source: BBC