Ex-Barclays Traders Have Rate-Rigging Convictions Quashed by London Court

A group of five ex-Barclays Plc traders, convicted of rigging benchmark interest rates in a series of landmark fraud prosecutions, had their convictions overturned by a London court.

Court of Appeal judges quashed the convictions of Alex Pabon, Jay Merchant and Jonathan Mathew, who were convicted of conspiracy to defraud in 2016 and jailed for helping to manipulate Libor. Philippe Moryoussef and Colin Bermingham, also both former Barclays traders, were both convicted of rigging Euribor in 2018 and 2019 respectively.

The reversals come after Tom Hayes, the ex-UBS Group AG trader who was the first and most high profile of the people convicted for rate rigging, had his conviction overturned at the UK Supreme Court. The court ruled that the jury was misdirected at the Hayes trial and that he and another trader, Carlo Palombo, should be exonerated.

The scandal — over the fixing of benchmark rates that underpinned more than $350 trillion of loans and securities — broke out when the banking community still faced public outrage after the 2008 financial crisis and led to global fines of almost $10 billion for a dozen banks and brokerages. Serious Fraud Office prosecutions led to nine convictions of bankers for fraud offenses.

READ MORE: Hayes Calls for All Rate-Rigging Convictions to Be Quashed

“A wrong turn occurred in August 2015 when a jury came to be directed in Hayes’ case,” Katherine Hardcastle, a lawyer representing Mathew and Moryoussef said in court. “The unsafety of these convictions is not contested” by the SFO.

Christian Bittar, a former Deutsche Bank AG trader who pleaded guilty to fraud charges in 2018, is the last outstanding conviction on the books. He will have his appeal hearing on Friday, which the SFO will contest.

The overturned convictions are a painful reminder for the SFO that its sprawling, years long investigation ultimately failed in court. The UK’s top fraud cop now faces pressure to prove it has the ability to make complex financial crime prosecutions stick.