Interesting outcome to the case of Tom Hayes and his manipulation of the Libor whilst working at Citigroup. As Hayes is serving his 11 year prison sentence, Citigroup looks to avoid criminal charges and has just been ordered to pay $425m as part of a settlement. The problem with this outcome is that members of Citigroup who worked with Hayes, knew about his intentions and said so bluntly. Is the monetary punishment enough to prevent additional institutions from shutting their eyes to such occasions?
The regulator said that in meetings with Citi managing directors after the trader was hired but before he started work, he “talked openly about how he had tried to manipulate” Yen Libor fixings while at UBS. Yet Citi managers “did not convey” the disclosures of the illicit practices to anyone in the bank’s compliance or legal departments, the watchdog added — even though they knew regulators were already investigating its Libor submission practices.