Three arrests were made today in the infamous Libor-rigging scandal. Here’s what we know so far.
Stay tuned for updates and photos.
1. Three Men Were Arrested
Under British law, officials are allowed to hold them for 24 hours without charging them. Then, an extension can be applied if the police need more time for questioning.
2. Ex-Citigroup Trader Thomas Hayes is Among those Arrested
Thomas Hayes, aged 33, built up his reputation as a trader at UBS from 2006 to 2009, then left for Citigroup, but was suspended in 2010 after attempting to illegally influence the Libor rates. He was fired in September of 2010 and his actions were reported to authorities by Citigroup.
3. The Other Two Worked at RP Martin Holdings
Sources confirmed to Bloomberg, but requested anonymity, that the two other men arrested, aged 41 and 47, worked for RP Martin Holdings Ltd.
4. They’re All British
All three men are British citizens and are being held in a police station in London.
5. UBS is Expected to Pay Record Setting Fine
Switzerland’s UBS is close to finalizing a settlement deal with American and British authorities. The bank is expected to pay more than $450 million to settle claims that some employees reported false rates to increase its profit. Thomas Hayes’ arrest will likely be significant in the American case against UBS that will be announced in the near future.
6. All Involved Banks are Staying Quiet
A spokesman for Citigroup in London declined to comment, and an RP Martin spokesman only said that the company doesn’t comment on employee issues, according to Bloomberg.
7. The Serious Fraud Office Is Mending Their Reputation
Theses arrests are seen as an attempt for the Serious Fraud Office, or SFO, to repair its reputation after its new leader, David Green, vowed to rejuvenate the agency. In the past, the SFO has not been able to properly police London’s financial world but now is receiving extra resources from the British government for this investigation.
8. Their Residencies Were Raided
The three men arrested were found in their houses and taken into police custody early this morning when raids of their residencies in the outskirts of London began. In the UK, police usually make arrests early in an investigation and do not necessarily mean those arrested will be charged with a crime.
9. Barclays is the Only Bank to Admit to Rigging
Back in June, the Barclays agreed to pay $450 million to settle charges that some of its employees attempted to manipulate Libor to increase profits. The investigation prompted many of Barclays’ top officials to resign, including chief executive, Robert E. Diamond Jr.
10. Over a Dozen Other Banks are Being Investigated
In response to the uproar over the scandal at Barclays, the SFO launched investigations into activities at JPMorgan Chase HSBC, Deutsche Bank and the Royal Bank of Scotland, among others banks.