Ex-Rabobank traders face first U.S. trial over Libor manipulation

Mon Oct 12, 2015 6:00pm EDT
 
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By Nate Raymond

NEW YORK (Reuters) - Two former Rabobank [RABO.UL] traders from Britain are set to become the first defendants to face trial in the United States on charges stemming from a global investigation into whether various banks sought to manipulate the interest rate known as Libor.

Jury selection is scheduled for Tuesday in Manhattan federal court in the case of Anthony Allen, 44, and Anthony Conti, 46, who are accused of helping manipulate interest rates to benefit the Dutch lender's trading positions.

The case is the first by the U.S. Justice Department to go to trial over allegations that financial institutions manipulated Libor, or the London interbank offered rate, a short-term rate banks charge each other for loans.

The rate, which was overseen by the British Bankers' Association (BBA), is calculated based on submissions by a panel of banks. It underpins $450 trillion of financial products globally from mortgages to credit card loans.

U.S. and European authorities have been investigating whether banks fraudulently submitted artificial rate estimates to the association to bolster their profits on trading derivatives linked to Libor.

Those investigations have resulted in charges against 22 people in the United States and United Kingdom and around $9 billion in regulatory settlements with financial institutions.

Those banks include Netherlands-based Rabobank, which as part of a $1 billion deal resolving U.S. and European Libor-related probes agreed in 2013 to pay $325 million as part of a deferred prosecution agreement with the Justice Department.

Allen, Rabobank's former global head of liquidity and finance, and Conti, a senior trader, were indicted in the United States in October 2014.   Continued...

 
Anthony Conti, a British citizen and former Senior trader with Rabobank, exits the U.S. Federal Courthouse in the Manhattan borough of New York April 13, 2015. REUTERS/Brendan McDermid