Banker is First in UK to Admit Charge Over Libor

London, A senior banker from a leading British lender has become the first person in the UK to admit criminal charges related to manipulating Libor.

The banker appeared at Southwark Crown Court on Friday, but his admission of guilt was only allowed to be reported yesterday (Tuesday). He was released on bail pending sentencing. The court has ordered that neither the name of the individual nor the bank can be disclosed.

The banker, who has since left his former employer, admitted a charge of conspiracy to defraud related to Libor, the crucial interest rate benchmark that influences the price of hundreds of trillions of pounds of financial contracts around the world.

The guilty plea follows a Serious Fraud Office (SFO) inquiry into the alleged rigging of Libor and marks the first UK criminal conviction arising from the investigation. Eleven other individuals stand charged and await trial, and the SFO is investigating others.

The US has already secured two guilty pleas from former rates traders at Rabobank – the British citizen Paul Robson and his colleague Takayuki Yagami – as part of its criminal investigation into Libor rigging. UK and US investigations into Libor have already led to a series of fines for seven banks and brokerages, with others expected soon.

Reports have claimed Germany’s Deutsche Bank is close to reaching an agreement with regulators on both sides of the Atlantic to become the eighth institution to settle over Libor.

In 2012, the bank said a “limited number” of staff were involved in the scandal, but that senior management were not.

The conviction in London is a boost to the SFO, which has been investigating Libor manipulation since 2012. The body had its future questioned by Theresa May, the Home Secretary, earlier this week.

In July, the office opened an inquiry into the rigging of foreign exchange rates, which many in the industry believe could result in disciplinary action more severe than that for Libor manipulation.

Last week, Lloyds Banking Group sacked eight staff and withheld bonuses after paying pounds 218m to authorities in the US and UK.

Andrea Leadsom, economic secretary to the Treasury, yesterday said it was “vital” to deal with wrongdoers and that the “integrity of the City matters to the economy of Britain”.

Earlier this year, laws came into force that made the manipulation of Libor a criminal offence.