Former Barclays banker tells court that bosses must have known about Libor fixes
A former Barclays trader who is currently standing trial accused of Libor-rigging related offences told the court late last week that three senior figures at the bank must have known about the rate fixing.
Jay Merchant, along with fellow former traders Stylianos Contogoulas, Alex Pabon and Ryan Reich and one of Barclays' former Libor submitters Jonathan Mathew, is on trial charged with conspiracy to defraud on allegations of conspiring to manipulate US-dollar linked Libor between June 2005 and September 2007.
Bloomberg reported that Merchant told the courtroom that he found it "difficult to believe" that Eric Bommensath, former global head of fixed income, and fellow executives Mike Bagguley and Harry Harrison, were unaware of what the swaps desk was doing.
"Everybody knew the banks set Libor to their own commercial interests," Merchant said, adding that requests to fix Libor were part and parcel of his job.
Bommensath, Bagguley and Harrison, none of whom are on trial, have all previously given evidence as witnesses for the prosecution. All have denied knowledge of staffs' requests to fix Libor to better suit trading positions, with Bommensath describing emails between staff contain such requests as "improper".
Earlier on in the trial, Bloomberg reported that the prosecution produced evidence of an interview between Merchant and the Serious Fraud Office (SFO), in which the former trader alleged that Bommensath told him over lunch "to introduce the New York swaps desk to these new practices" and to "teach them how to communicate with the cash desk in London and make the New York desk more profitable".
Merchant was the highest paid of all the men on trial, with a pay packet worth £2.2m in salary and bonuses in 2007.
The trial, which is currently being heard at Southwark Crown Court, is the third brought by the SFO in relation to their ongoing investigation into Libor.