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Two former Barclays bankers have been cleared of conspiring to rig a key interest rate in a retrial.
Traders Stylianos Contogoulas and Ryan Reich were unanimously acquitted by a jury at Southwark Crown Court. Their acquittals came after a jury in a separate trial last year failed to reach a verdict on the two men but convicted three of their former Barclays colleagues for conspiring to rig key interest rate.
Greek-born Mr Contogoulas and American Mr Reich had faced one count of conspiracy to defraud with others at Barclays to manipulate US dollar Libor — the benchmark interbank lending rate — for more than two years, until September 2007. They had denied wrongdoing.
Prosecutors from the Serious Fraud Office had claimed in the trial that the men “essentially cheated” others when they schemed with Libor submitters at Barclays to nudge dollar Libor rates and bolster their trading positions.
Emma Deacon QC, representing the anti-fraud agency, had claimed that the men were “driven by money” to make more profit on their trading and saw “honesty and integrity” as “entirely expendable”.
Prosecutors used email and phone call evidence to claim that traders were making rate requests.
Mr Contogoulas, a trader on Barclays’ swaps desk in London, sent messages about Libor submissions to Peter Johnson, a Libor submittor at Barclays who was convicted last year, the court heard.
Mr Contogoulas told him: “Remember when I retire and write a book about this business your name will be written in golden letters and you’ll have an open invitation to my bar in the Greek islands . . . hee, hee.” “I’d prefer this not to be in any books . . .” Johnson replied.
Prosecutors alleged that this showed both men knew what they were doing was wrong. Mr Contogoulas, who gave evidence in his first trial but not in his second, had claimed that such messages were just “banter”.
In his first trial Mr Contogoulas testified to the jury that he had been instructed by his boss within days of joining the Barclays dollar desk in London in 2005 to tell a senior colleague the level he wanted Libor rates set at. This was done “very openly and in a very normal way” he testified.
In the retrial, Ryan Reich, a Princeton-educated baseball playing American who worked on the New York swaps desk, told the jury that his communications with the Libor submitters were done “openly.”
He testified that he was “never in a conspiracy” and that he had been open about his communications with the Libor submitters.
In cross examination, prosecutor Emma Deacon QC put to him that the Libor rate was suppseed to be set independently. “We did not know it was independent and it is not helpful to pretend it was,” Mr Reich told the court. “It was not independent and no one thought it was.”
In the trial last July Jonathan Mathew, 35, a former Barclays Libor submitter, along with ex-Barclays traders Jay Merchant, 45 and Alex Pabon were found guilty of conspiring with others at Barclays to manipulate US dollar Libor. Peter Johnson, the main Libor submitter at Barclays, had already pleaded guilty to rate rigging.
The re-trial brings to a close the three Libor prosecutions brought by the Serious Fraud Office.
The agency is also bringing a prosecution of six individuals who deny manipulating Euribor, the key global interest rate benchmark. The six are due to stand trial in September.