|Other names||Thomas Alexander William Hayes|
|Alma mater|| Hult International Business School |
University of Nottingham
|Known for||Libor Scandal|
|Criminal charge||Participating in Libor Scandal|
Tom Hayes (born October 1979) is a former trader for UBS and Citigroup who was sentenced to 14 years in prison (reduced to 11 years on appeal) for dishonestly manipulating the London Interbank Offered Rate (Libor) as part of the Libor scandal. Hayes, in the course of his defence, asserted managers were aware of his actions, and even condoned them. At trial Hayes was diagnosed with mild Asperger syndrome.
Tom Alexander William Hayeswas born in West London to Nicholas and Sandra Hayes, and initially grew up in Hammersmith. He moved with his mother to Winchester after his parents divorced, where he was raised by his mother, and Timothy, his stepfather. He attended The Westgate School, and, later, Peter Symonds College. A fellow student described him as an "incredibly smart geek".
After Peter Symonds, he attended the University of Nottingham, working in a restaurant kitchen during the summer holidays.He graduated with a degree in mathematics and engineering.
In 2001, after time as an intern at UBS, he joined Royal Bank of Scotland's trainee programme, at the interest rate derivatives desk.After working for Royal Bank of Scotland as a junior trader, he was headhunted by Royal Bank of Canada in 2004, and, upon moving there, he assumed greater responsibility. After two years at RBC, he moved to UBS in late 2006. Hayes was placed in the Tokyo office of UBS, where he began making trades involving the discrepancies between the Libor rate and Japanese interest rates.
Hayes turned down an offer from Goldman Sachs in 2008, but in 2009, accepted an offer from Citigroup; the bank gave him a $3 million signing bonus.
Hayes graduated with an MBA from Hult International Business School studying at the London campus. He met Jennifer Arcuri there and founded software company Title X Technology with her in 2012, using developers in Bulgaria.
Hayes traded derivatives at UBS and, later, Citigroup, in Tokyo. His favoured activity was basis trading, speculation on the movements in Libor expressed in multiple currencies and various durations, trades he might hedge with trades in other derivatives. The daily reporting of Libor rates by bankers around the world determined his success or failure in generating profits for his bank and bonuses for himself. By September 2008, a one basis point (1/100 of one per cent) move in Libor had about a US$750,000 effect on his bottom line. Through a network of his broker contacts, including one at the world's largest inter-dealer broker, ICAP, he succeeded in having Libor reported lower than its true level in order to drive his profits and personal bonuses higher.
In less than 9 months, in 2010, Hayes was fired by Citi for his Libor activities. In its letter dismissing the 35-year-old former trader, the bank wrote: "Citigroup has uncovered that you attempted to manipulate the Yen Libor and [the Tokyo equivalent] Tibor rates in order to benefit your trading position," which it said was a clear breach of its code of conduct, "resulting in the possibility of serious regulatory actions". [ citation needed ]After being fired, he moved back to England, where he day traded with his Citi bonus.
On 11 December 2012, Hayes was arrested by British authorities for his involvement in manipulating Libor rates, and on 19 December, he was charged by the United States for the same crime. In order to avoid extradition to and subsequent trial by and imprisonment in the U.S., Hayes initially cooperated with the Serious Fraud Office, providing eighty hours of interviews so as to be charged by the United Kingdom. After being charged, Hayes withdrew his offer of cooperation, intending instead to fight the charges levied by the SFO. [ citation needed ]In response, the SFO narrowed the scope of their charges, so leaving less overlap between charges by American and British prosecutors, creating the possibility of a second trial in the United States.
Hayes was diagnosed with a mild version Asperger syndrome before his trial [ citation needed ]and was accompanied by a court-appointed aide during the trial. Throughout the trial, prosecutors used Hayes' SFO interviews to establish his greed and corruption. The defence attempted to illustrate that manipulation of Libor was both widespread and expected as part of Hayes' job description, with senior management aware of the tactic.
In August 2015, Hayes was sentenced to fourteen years in prison, to serve a minimum half of this sentence before being considered for early release.The judge, Jeremy Cooke, indicated he wished to "send a signal" to traders involved in illegal trading, as the sentence was significantly harsher than those given to other individuals convicted of financial crimes, such as Nick Leeson. Hayes maintained his innocence through the trial process, notwithstanding having stated during SFO interviews,
"Well look, I mean, it's a dishonest scheme, isn't it? And I was part of the dishonest scheme, so obviously I was being dishonest."
Appeals by Hayes against conviction failed but his sentence was reduced by the Court of Appeal comprising Sir Brian Leveson, Elizabeth Gloster and John Thomas, Baron Thomas of Cwmgiedd to eleven years, under the same parole conditions.
Having exhausted all avenues of appeal, in May 2016, Hayes instructed solicitor Karen Todner to make an application for review by the Criminal Cases Review Commission (CCRC).In December 2021, the CCRC handed down a provisional judgement not to refer Hayes' case to the Court of Appeal.
In October 2022, the United States dismissed criminal charges against Hayes.
In July 2023 Hayes was finally referred by the CCRC back to the court of appeal in the U.K. following the Connolly and Black second circuit appeal court decision in the USA.
In 2016, Hayes released letters concerning his time in prison.In them, he described being held separately from other prisoners, for his protection, in a "segregation unit". In 2019 he was moved to HM Prison Ford. Interviewed in "The Times" Hayes spoke of the struggles with his mental health and how becoming a Christian and the ministry of the church had helped him to survive.
On 29 January 2021 Hayes was released on licence from Ford open prison having served half his sentence.
Hayes' marriage to Sarah Tighe, a corporate lawyer in London, did not last the duration of his imprisonment. Although separated, the couple remain on good terms and Tighe campaigned for Hayes' conviction to be quashed. They have one child, Joshua.At trial Hayes was diagnosed with mild Asperger syndrome.
In March 2021, Hayes was also diagnosed with Multiple sclerosis, which he stated was aggravated by his time in prison.
The London Inter-Bank Offered Rate is an interest rate average calculated from estimates submitted by the leading banks in London. Each bank estimates what it would be charged were it to borrow from other banks. It is the primary benchmark, along with the Euribor, for short-term interest rates around the world. Libor was phased out at the end of 2021, and market participants are being encouraged to transition to risk-free interest rates such as SOFR and SARON.
The Serious Fraud Office (SFO) is a non-ministerial government department of the Government of the United Kingdom that investigates and prosecutes serious or complex fraud and corruption in England, Wales and Northern Ireland. The SFO is accountable to the Attorney General for England and Wales, and was established by the Criminal Justice Act 1987, an Act of the Parliament of the United Kingdom.
William Raymond Smith III was an American football defensive end in the National Football League (NFL). He played college football for Ohio State and was drafted by the New Orleans Saints in the first round of the 2004 NFL draft, where he played for the entirety of his career. Smith was shot and killed during an altercation after an alcohol related traffic crash.
William Jensen "Billy" Cottrell is a former Ph.D. candidate at the California Institute of Technology who was convicted in April 2005 of conspiracy associated with the destruction of eight sport utility vehicles and a Hummer dealership in the name of the Earth Liberation Front (ELF). He was sentenced to eight years in federal prison on conspiracy charges and ordered to pay $3.5 million in restitution. He was released August 16, 2011.
The Guinness share-trading fraud was a major business scandal of the 1980s. It involved the manipulation of the London stock market to inflate the price of Guinness shares to thereby assist Guinness's £4 billion takeover bid for the Scottish drinks company Distillers. Four businessmen were convicted of criminal offences for taking part in the manipulation. The scandal was discovered in testimony given by the US stock trader Ivan Boesky as part of a plea bargain. Ernest Saunders, Gerald Ronson, Jack Lyons and Anthony Parnes, the so-called Guinness four, were charged, paid large fines and, with the exception of Lyons, who was suffering from ill health, served prison sentences. The case was brought by the Serious Fraud Office.
Lanny Arthur Breuer is an American criminal defense lawyer who currently serves as vice chair of Covington & Burling LLP. From 2009 to 2013, he served as Assistant Attorney General for the Criminal Division of the U.S. Department of Justice under President Barack Obama. From 1997 to 1999, he served as Special Counsel to President Bill Clinton. He is a fellow of the American College of Trial Lawyers.
In financial trading, a rogue trader is an employee authorized to make trades on behalf of their employer who makes unauthorized trades. It can also involve mismarking of securities. The perpetrator is a legitimate employee of a company, but enters into transactions on behalf of their employer, or mismarks securities held by their employer, without their employer's permission.
The Westgate School is a mixed all-through school located in Winchester, Hampshire, United Kingdom.
David Jules Enrich is an American journalist and non-fiction author. He is currently financial editor at The New York Times and was previously financial enterprise editor at The Wall Street Journal.
Michael John Anderson was convicted of having murdered Katherine Ann Olson in October 2007. Because Anderson met Olson through Craigslist, a popular classified advertising website, the media dubbed him a Craigslist Killer, a generic term for murderers who find victims by placing or responding to ads in Craigslist. Anderson was the first killer given this title in news accounts.
Operation Bid Rig was a long-term investigation into political corruption in New Jersey conducted by the Federal Bureau of Investigation, the Internal Revenue Service, and the United States Attorney for the District of New Jersey from 2002 to 2014.
On July 23, 2007, Linda Hayes and Joshua Komisarjevsky invaded the residence of the Petit family in Cheshire, Connecticut. Though initially planning only to rob the house, Hayes and Komisarjevsky murdered Jennifer Hawke-Petit and her two daughters, 17-year-old Hayley Petit and 11-year-old Michaela Petit. Their father, Dr. William Petit, escaped with severe injuries.
The 2011 UBS rogue trader scandal caused a loss of over US$2 billion at Swiss bank UBS, as a result of unauthorized trading performed by Kweku Adoboli, a director of the bank's Global Synthetic Equities Trading team in London in early September 2011.
Kweku Adoboli is a Ghanaian investment manager and former stock trader. He was convicted of illegally trading away US$2 billion as a trader for Swiss investment bank UBS. While at the bank he primarily worked on UBS' Global Synthetic Equities Trading team in London, where he engaged in what would later be known as the 2011 UBS rogue trader scandal. After serving a prison sentence, he lost several appeals against the UK Home Office decision to deport him to Ghana.
Jeremy Nevill Bamber is a British convicted mass murderer. He was convicted of the 1985 White House Farm murders in Tolleshunt D'Arcy, Essex, in which the victims included Bamber's adoptive parents, Nevill and June Bamber; his adoptive sister, Sheila Caffell; and his sister's six-year-old twin sons, Daniel and Nicholas Caffell. Returning a majority guilty verdict, the jury found that, after committing the murders to secure a large inheritance, Bamber had placed the rifle in the hands of his 28-year-old sister, who had been diagnosed with schizophrenia, to make the scene appear to be a murder–suicide.
The Libor scandal was a series of fraudulent actions connected to the Libor and also the resulting investigation and reaction. Libor is an average interest rate calculated through submissions of interest rates by major banks across the world. The scandal arose when it was discovered in 2012 that banks were falsely inflating or deflating their rates so as to profit from trades, or to give the impression that they were more creditworthy than they were. Libor underpins approximately $350 trillion in derivatives. It is currently administered by Intercontinental Exchange (ICE), which took over running the Libor in January 2014.
The forex scandal is a 2013 financial scandal that involves the revelation, and subsequent investigation, that banks colluded for at least a decade to manipulate exchange rates on the forex market for their own financial gain. Market regulators in Asia, Switzerland, the United Kingdom, and the United States began to investigate the $4.7 trillion per day foreign exchange market (forex) after Bloomberg News reported in June 2013 that currency dealers said they had been front-running client orders and rigging the foreign exchange benchmark WM/Reuters rates by colluding with counterparts and pushing through trades before and during the 60-second windows when the benchmark rates are set. The behavior occurred daily in the spot foreign-exchange market and went on for at least a decade according to currency traders.
Carsten Kengeter is the former CEO of Deutsche Börse. He was the chief executive officer and Head of the management board of Deutsche Börse AG from June 1, 2015, to Jan 1, 2018.
Karen Elizabeth Todner is a British solicitor. Her clients include hacker Ryan Cleary linked with LulzSec, Gary McKinnon known as the "Pentagon Hacker", and Lauri Love.
Patrick John Harrington KC is a Welsh criminal law barrister and King's Counsel. He has acted in more than 250 homicide trials, and has been noted for work on some of "the largest and most complex fraud cases in the UK". He has been referred to as one of Wales' "most prominent" lawyers.