By Kirstin Ridley
LONDON (Reuters) -Former star UBS and Citigroup trader Tom Hayes, the first person jailed over the Libor rate scandal, can return to the Court of Appeal in a fresh attempt to overturn his conviction after an eight-year battle to clear his name.
In a landmark decision, the Criminal Cases Review Commission (CCRC), an independent body that investigates potential miscarriages of justice, said on Thursday there was a “real possibility” that Hayes’s conviction could be overturned.
“We have concluded … that the Court of Appeal should clarify whether the right legal approach was taken in Mr Hayes’ case,” CCRC Chairman Helen Pitcher said in a statement, after a six-and-a-half year inquiry.
Hayes, who was released from jail on licence in 2021 after serving half of an 11-year sentence, said he was delighted with the decision but added: “We will continue to also pursue justice through the House of Commons (and) through a new Libor enquiry to expose and hold to account those responsible”.
“It remains a tragedy that so many lives were ruined by the false narrative propagated from 2012, when various enquiries were lied to by multiple powerful institutions,” he said.
Hayes, who has Asperger’s syndrome, was portrayed by the prosecutor and judge, who sentenced him to an initial 14 years in jail in 2015, as a man without integrity who had succumbed to temptation and greed during the financial crisis.
The gifted mathematician, who was charged by both U.S. and British prosecutors after a global investigation, has long argued his trading methods were standard market practice and condoned by bosses at the time.
The Serious Fraud Office (SFO), which prosecuted the high-profile cases involving Libor (London interbank offered rate) and its euro equivalent Euribor in Britain, said its cases were based on evidence and the applicable law.
“We stand ready to support the Court of Appeal as it considers this referral,” a spokesperson for the SFO said.
SCAPEGOAT
Libor and Euribor were benchmarks used to set rates on trillions of dollars in loans, mortgages and derivatives.
Hayes stepped up his fight after a U.S. court overturned the convictions of two other former Libor traders in 2022 and U.S. authorities dropped their charges against him. German and French authorities have also not prosecuted benchmark rigging cases.
Karen Todner, his lawyer, said Hayes’ conviction was a miscarriage of justice that demanded immediate correction, adding that he and others had been used by the government and senior bankers as scapegoats.
Ben Rose, a lawyer at Hickman & Rose who is representing four former traders convicted of manipulating both Libor and Euribor, said convictions were based on a legally flawed and procedurally unfair process.
Former Barclays trader Carlo Palombo, convicted in 2019 of conspiring to rig Euribor, will now also seek an urgent CCRC referral, Rose said.
Only a fraction of CCRC applications are successful. Of almost 30,240 received since April 1997, the CCRC has sent 814 back for appeal, according to its website.
Leading banks and brokerages paid about $9 billion to settle allegations of benchmark manipulation. Libor, once dubbed the world’s most important number, has been largely scrapped.
(Reporting by Kirstin Ridley; Editing by David Holmes)
