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Libor trial: Sacked Tom Hayes kept £2.2m bonus
Former UBS and Citigroup trader allegedly told bosses: 'how much are you going to pay me to go quietly?'
A banker was allowed to keep a £2.2m bonus after threatening to blow the whistle on senior managers at Citigroup after he was sacked for rigging Libor, a court has heard.
Tom Hayes, who worked for UBS and the American bank in Tokyo, allegedly told the chief executive of Citigroup’s markets division in Japan that “you were involved in it up to your eyeballs” when he was fired in September 2010.
According to records of an interview between Mr Hayes and interviewers from the Serious Fraud Office, the trader had reacted furiously when told he was being fired, claiming he was a “fall guy”, whose sacking had allowed his seniors to go quietly.
Mr Hayes has pleaded not guilty to eight counts of conspiracy to defraud in relation to manipulating Libor, an interest rate benchmark that is supposed to reflect bank borrowing costs. The crime carries a sentence of up to 10 years.
Tom Hayes and wife Sarah arriving at court
The prosecution claims he was the “ringmaster” in a conspiracy to manipulate the rate for his profit.
On Tuesday, the fifth day of proceedings in a trial that is the first of its kind, prosecutors ran through interviews between Mr Hayes and SFO investigators from 2013, when Mr Hayes was co-operating with the authority. He changed his mind later that year.
According to the minutes of the interview, Mr Hayes told Brian McCappin, the chief executive of Citigroup Global Markets Japan: “How much are you going to pay me to go quietly, otherwise I’m going to make a real fuss about this.”
Mr Hayes told the SFO that Citi could not pay him anything extra, but was allowed to keep a signing on bonus he received when he joined from UBS, worth 292m yen (£2.2m at the time), that he would normally have had to pay back.
In a subsequent letter to the bank, after he had received confirmation of his sacking in writing, Mr Hayes said: “I refute that my actions could constitute wrongdoing. My actions were entirely consistent with those at other senior levels. Senior management were aware of my actions.”
The trial continues.