Three former Barclays traders convicted in Libor-rigging case

London's Southwark Crown Court

The case was heard at London’s Southwark Crown Court

British citizens Jonathan Mathew and Jay Merchant as well as American Alex Pabon were convicted by a jury at Southwark Crown Court after an 11-week trial.

The jury couldn’t reach verdicts for two of their co-defendants, Stylianos Contogoulas and Ryan Michael Reich, the UK’s Serious Fraud Office wrote in a press release on July 4.

Merchant and Pabon were both Libor traders, while Mathew was a submitter. Peter Johnson, a senior submitter and head US dollar cash trader, pleaded guilty to conspiracy to defraud in October 2014.

Their offences took place between June 2005 and September 2007, the SFO said.

The SFO alleged the five men acted dishonestly by trying to influence the London interbank offered rate, a benchmark used to set interest rates on trillions of dollars in securities and loans, to advantage Barclays and themselves financially and to defraud those with whom they were trading.

The Wall Street Journal first drew attention eight years ago to industry concerns around how Libor was being set, sparking a global probe that has resulted in at least 13 convictions and billions of dollars in penalties paid by banks. Barclays paid $ 450 million to US and UK authorities in 2012 and admitted that traders and managers had sought to rig the rate.

It was the third criminal Libor trial in the UK after the SFO’s conviction in August of Tom Hayes, the alleged ringleader of a separate Libor-rigging conspiracy, and the acquittal in January of six former brokers who were accused of conspiring with Hayes. Hayes is serving an 11-year sentence.

US prosecutors have charged more than a dozen traders and other bank employees with trying to manipulate Libor, including traders in London and elsewhere. To date, four have pleaded guilty and two others were convicted at trial.

The SFO alleged that the six Barclays employees conspired to manipulate dollar Libor between June 2005 and September 2007. In the 11-week trial, jurors were shown emails and messages sent by Merchant, Pabon, Reich and Contogoulas to Barclays’s Libor submitters, Johnson and Mathew. The messages showed that the four traders had requested rates that would benefit their trading books, and that Mathew at least in some cases complied, but the men and their lawyers told the court they had acted honestly and with the knowledge of their bosses.

Mathew told the court he was never trained in his role as a Libor submitter and learned from and copied what Johnson was doing. He, Merchant and Pabon were found guilty by the jury on Wednesday but the judge imposed temporary reporting restrictions while the remaining verdicts were decided.

Before concerns arose around Libor in 2008, banks participating in setting the benchmark faced little scrutiny of how they came up with their daily submissions. Meant to reflect a bank’s estimated cost of borrowing, many banks’ Libor submitter and traders regularly shared information with each other, brokers and traders at other banks, according to evidence presented in the three London trials.

Write to Margot Patrick at and Josie Cox at

This story was first published by The Wall Street Journal

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