This “Libor bitch” could get leashed.
The US government unveiled its most damning evidence so far against two ex-Rabobank traders in Manhattan federal court on Monday, including chats, e-mails and recorded calls in which the bankers allegedly colluded to rig one of global finance’s most crucial benchmarks.
Anthony Allen, a former global head at the bank in London, and one of his traders, Anthony Conti, are accused to rigging Libor, an interest rate at the heart of trillions of dollar of financial contracts.
Prosecutors claim that the culture at the Utrecht, Holland-based Rabobank was so corrupt that its bankers would openly talk about it in chats and in the office.
“I AM FAST BECOMING YOUR LIBOR BITCH!!!!” Allen complained to another subordinate trader in a Bloomberg chat after being asked to rig the rate.
In a call, prosecutors say Allen openly solicited another trader to tell him where to set the rate.
“Where do you want them?” Allen asked.
“Maybe a smidgen lower,” the other trader, Paul Thompson in Hong Kong, said.
Libor is set by an independent commission based on the submitted rate estimates of 16 banks.
The Libor scandal, in which bankers pushed the rate up or down in order to manipulate interest rates and complex derivative transactions, first engulfed the global financial world in 2012.
Five banks, including UBS and JPMorgan Chase, paid $5.6 billion in fines in May to settle charges.
Rabobank has already admitted to rigging the rates in order to enrich itself and its traders, and paid about $1 billion in fines.
At trial, prosecutors also played a recording of another call that took place after the British Bankers Association launched an investigation into the Libor rigging in which Conti and other bankers discussed how much trouble they could be in.
“I think that’s what pushed Libors back up,” Conti said, noting that rates rose after the start of the probe.
“I’m not quite sure, legally, what they can do about this,” he added.
Lawyers for Conti and Allen claim their clients didn’t do anything wrong.