Convicted LIBOR manipulator Tom Hayes ordered to pay £878,806 confiscation order

Tom Hayes, the first individual to be convicted after trial for the manipulation of LIBOR*, has been ordered to pay a confiscation order of £878,806 at Southwark Crown Court, sitting at the Central Criminal Court and the Rolls Building. 

Hayes was convicted of eight counts of conspiracy to defraud in August 2015 and sentenced to 14 years in prison, later reduced to 11 years on appeal.

During the confiscation proceedings, the court was asked to consider three questions:

*Had the defendant benefited from relevant criminal conduct?

*If so, what was the value of the benefit he obtained?

*What sum was recoverable from him?

Mr Justice Cooke, who oversaw the trial and confiscation proceedings, found that Hayes would not have been rated as highly as he was by UBS and Citi if he hadn’t achieved success in the manipulation of LIBOR and therefore would not have been rewarded as highly as he was but for that activity.

Mr Justice Cooke agreed with the Serious Fraud Office (SFO) that it cannot be known what the LIBOR would have been but for the defendant’s attempts to manipulate it.

In deciding on the scope of the criminal benefit, the Judge evaluated the extent to which Hayes’ attempt to manipulate LIBOR affected his overall trading activities and the impact this would have had on the profit/loss position of his employers and his own remuneration.

After considering the above factors, Mr Justice Cooke concluded that the final amount to be confiscated is the sum of £878,806. The total available assets are in the sum of £1,705,167.56.

Mr Justice Cooke ordered that Hayes must satisfy the order within a specified period or incur a default prison sentence of three years.

Commenting on the confiscation order, Mark Thompson (head of the SFO’s Proceeds of Crime Division) said: “The court acknowledged the challenges of quantifying the benefit from crime in this case. The SFO provided the court with all the available information and the outcome is a substantial confiscation order, which Mr Hayes will need to satisfy or face a further period of imprisonment.”

*The London Interbank Offered Rate, or LIBOR, is the average interest rate at which banks can borrow from one another. Yen LIBOR is the average interest rate at which a large number of banks on the London money market are prepared to lend one another unsecured funds denominated in Japanese yen. A huge number of investments and trades are referenced to LIBOR. These transactions involve small businesses, large financial institutions and public authorities alike as well as individuals affected by the interest rates attached to a wide range of contracts including loans, savings rates and mortgages

About the Author
Brian Sims BA (Hons) Hon FSyI, Editor, Risk UK (Pro-Activ Publications) Beginning his career in professional journalism at The Builder Group in March 1992, Brian was appointed Editor of Security Management Today in November 2000 having spent eight years in engineering journalism across two titles: Building Services Journal and Light & Lighting. In 2005, Brian received the BSIA Chairman’s Award for Promoting The Security Industry and, a year later, the Skills for Security Special Award for an Outstanding Contribution to the Security Business Sector. In 2008, Brian was The Security Institute’s nomination for the Association of Security Consultants’ highly prestigious Imbert Prize and, in 2013, was a nominated finalist for the Institute's George van Schalkwyk Award. An Honorary Fellow of The Security Institute, Brian serves as a Judge for the BSIA’s Security Personnel of the Year Awards and the Securitas Good Customer Award. Between 2008 and 2014, Brian pioneered the use of digital media across the security sector, including webinars and Audio Shows. Brian’s actively involved in 50-plus security groups on LinkedIn and hosts the popular Risk UK Twitter site. Brian is a frequent speaker on the conference circuit. He has organised and chaired conference programmes for both IFSEC International and ASIS International and has been published in the national media. Brian was appointed Editor of Risk UK at Pro-Activ Publications in July 2014 and as Editor of The Paper (Pro-Activ Publications' dedicated business newspaper for security professionals) in September 2015. Brian was appointed Editor of Risk Xtra at Pro-Activ Publications in May 2018.

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