“Is a 35-year-old mathematician the modern face of financial crime?
In a trial starting on Tuesday in London, British prosecutors will contend that the answer is yes. They are preparing to cast Tom Hayes, a former star trader at UBS AG and Citigroup Inc, as the ringleader of a global conspiracy to manipulate the London interbank offered rate, or Libor.
Mr Hayes's expected defense: He is being unfairly singled out for behavior that was widespread all over Wall Street. The argument rests primarily on the fact that his bosses knew what he was doing and sometimes participated alongside him, which explains why he didn't think what he was doing was wrong.
UBS has pleaded guilty to manipulating Libor and acknowledged that managers were involved. A Citigroup unit in Japan was punished for rate rigging in 2011. At the time, the bank apologised to clients, but it didn't formally admit to wrongdoing or address whether people senior to Mr Hayes were involved. Citigroup hasn't entered into settlements with US or British regulators.
"This goes much much higher than me," Mr Hayes said in a 2013 text message to The Wall Street Journal, his only public comment on the case aside from entering his not-guilty plea. Libor underpins interest rates on trillions of dollars of mortgages, loans and other products.”
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