Bankers 'driven by money' in 'rigging' Libor: prosecutors
Five former bankers who worked for Barclays were "driven by money" when they conspired to fix the Libor lending rate, prosecutors told a London court as their trial opened Tuesday.
"This is a fraud case," prosecutor James Hines told the jury at Southwark Crown Court.
"The defendants were employees of Barclays Bank and the prosecution case is that they conspired to defraud the people with whom they trade by dishonestly rigging the Libor rate.
"In doing so they were driven by money... to make more profit on their trading."
The defendants are Jonathan James Mathew, 35; Stylianos Contogoulas, 44, from Greece; and Jay Vijay Merchant, 45, Alex Pabon, 37, and Ryan Reich, 34, who live in the United States.
They each deny manipulating the US dollar London Interbank Offered Rate between June 1, 2005 and August 31, 2007.
Libor is the benchmark inter-bank lending rate and a key reference for financial products globally.
It is the average interest rate at which banks can borrow unsecured funds from one another in the London market.
The rate underpins hundreds of trillions of dollars of contracts, from mortgages to corporate lending.
Hines said the jury would have to determine: "Is what the defendants did dishonest, and if so, did they know it?"
He said Merchant, Pabon and Reich, based in New York, would tell Mathew, who would submit the Barclays rate to other banks for calculation of the overall rate, whether they wanted the rate to go up or down.
Hines said Mathew would then do his best to ensure the requests were carried out.
"The purpose of the agreement was specifically to prejudice the economic interest of the other parties -- those others who were dealing with Barclays by reference to Libor," the prosecutor said.
Britain's Serious Fraud Office began investigating the alleged fixing of Libor in 2012.
The trial continues Wednesday and is expected to last 13 weeks.