Britain’s fraud prosecutor has charged two former brokers at interdealer broker RP Martin with rigging Libor benchmark interest rates, broadening the scope of the investigation into the scandal beyond big banks.
The Serious Fraud Office (SFO) said it had charged Terry Farr and James Gilmour with conspiracy to defraud, seven months after arresting them. They are the first staff from a broking firm charged in connection with the Libor investigation in Britain.
The two were arrested just before Christmas along with former UBS and Citigroup trader Tom Hayes, who was last month charged with eight counts of conspiracy to defraud as the SFO laid the groundwork for what could be the first Libor trial.
A central cog in the world financial system, the London interbank offered rate (Libor) is used as a reference for more than US$550 trillion (HK$4,267 trillion) in contracts ranging from complex derivatives to everyday credit card bills.
Trust in the benchmark was shaken by revelations last year that traders had routinely manipulated it, prompting a series of investigations by regulators and other authorities.
Britain’s Barclays and Royal Bank of Scotland and Switzerland’s UBS have been fined by US and UK authorities for manipulating Libor, and more banks and individuals are under investigation.
