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Hayes saw his Libor requests as a 'numbers game' – judge
Judge recaps Hayes's evidence from the witness stand as summing-up continues
![Tom Hayes Tom Hayes](/sites/default/files/styles/landscape_750_463/public/import/IMG/804/321804/tom-hayes-2-web.jpg.webp?h=d5737d39&itok=ShKu0KuH)
Judge Jeremy Cooke said today (July 24) that Tom Hayes thought of his scheme to influence the yen London interbank offered rate (Libor) as a "numbers game": the more requests he made, the more chances he would have of the reference rate being set in his favour.
The judge was today summing up evidence for the jury in a speech that is expected to conclude on Monday morning. Much of the day's proceedings were focused on Hayes's time in the witness box.
"Mr Hayes began and ended his evidence [by saying] that he did not act dishonestly," said Cooke. The way Hayes saw it, "he was just doing his job" when he informed Libor submitters of his trading positions and tried to convince them to change their submissions.
Libor trial: latest updates
Day-by-day coverage of Tom Hayes Libor trial
Cooke pointed the jury to an email shown by the defence in which Hayes told his senior manager during a 2010 internal investigation at Citi that he "couldn't work out what he had done wrong".
The prosecution has argued that between 2006 and 2010 Hayes was the "ringleader" of a dishonest scheme to rig the yen Libor to benefit his trading book at the expense of others. Hayes was a derivatives trader at UBS between September 2006 and mid-2009. He moved to Citibank in December 2009 before being dismissed in September the following year over his attempts to influence the bank's yen Libor submitter.
Cooke reminded the court that Hayes admitted to dishonesty – a key element of the eight charges of conspiracy to defraud he faces – during interviews with the Serious Fraud Office (SFO) in the months after his arrest in December 2012.
The jury was referred to a transcript in which Hayes says to investigators: "I mean I probably deserve to be sitting here because, you know, I made concerted efforts to influence Libor. And, you know, although I was operating within a system, or participating within a system in which it was commonplace, you know, ultimately I was someone who was a serial offender within that."
Hayes had taken part in 82 hours' worth of interviews with the SFO in order to sign a co-operation agreement, giving a full account of his actions and naming senior management at both UBS and Citi involved in the scheme, as well as traders at other banks, and brokers.
The agreement – which also secures eligibility for a reduction in any sentencing – was torn up a few months after it had been signed, and Hayes now claims he only admitted guilt so as to be charged in the UK and avoid extradition to the US.
"He said he went crazy and frozen with fear" at the prospect of facing three charges in the US which carry 20- or 30-year sentences, said Cooke. "Mr Hayes said that at the time he pretty much had a breakdown" and he had not given a lot of thought to what he was signing, the judge told the jury today.
Hayes has told the court that the requests he made to submitters, brokers and traders were usually quite "ad hoc" and carried out on a day-to-day basis.
The prosecution has argued in the trial, which began on May 26, that Hayes knew what he was doing was wrong due to the language he used as he persuaded others to field his Libor requests. Some were read out today, such as "not on a recording line", "a quiet word", "sort of subtly say", "don't be pushy", "don't put it in writing", and "catch him on the way to the toilet".
He also should have known about internal warnings over the Libor submission process, says the prosecution, which the defence disputes. The court heard again today of a group email, for instance, sent by Citi senior manager Andrew Thursfield in early December 2009 in which Citi's stance on the Libor-setting process is laid out: "The rules for rate setting are very strict. While additional information on relevant market activity can help as an input into the process, any recommendation or suggestions as to where rates should be set have to be disregarded."
Thursfield was responding to his colleague Stantley Tan, who had made queries about the yen Libor and market information.
The court has heard that the email was then forwarded to Hayes, who had only just commenced his employment at Citi. A few days afterwards, Hayes asked London-based trader Hayato Hoshino if he regularly talked to the cash desk and if he knew about Libor moves in advance. "If we know ahead of time we can take a position and scalp the market," Hayes said, according to the transcript of the conversation.
The judge reminded the jury today that Hayes could not recall receiving the email. Hayes told the court during his evidence that if he had read it, he would not have contacted the cash desk. The instructions make it "crystal clear" traders cannot request Libors, he has said.
The defence says the practice of attempting to influence Libor was widespread, and Hayes's senior managers were aware of his activities. Hayes's manager at Citi, Chris Cecere, sent an email to Hoshino and Hayes in 2010 informing them to "call each other on mobile if you need to speak so nothing is lost in translation".
Hayes had by then realised he could not be as "explicit" in his requests as he had been at UBS, said Cooke.
Cooke also reminded the jury that Hayes said he believed asking other traders and brokers to move Libor rates up and down was just "a probability exercise" and that "there was no downside in making those requests".
The trial continues.
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