R v Hayes
A trader who sought to manipulate LIBOR submissions to benefit his trading positions was rightly convicted of conspiracy to defraud, and his sentence was reduced to 11 years.
Facts
Tom Hayes was a derivatives trader at UBS and then Citigroup in Tokyo. Over several years, he asked submitters at his banks and at other banks, and brokers, to make submissions for yen LIBOR which would benefit his trading positions. He was the first person to be tried for LIBOR manipulation, and was convicted of conspiracy to defraud and sentenced to 14 years' imprisonment. He appealed against conviction and sentence, arguing among other things that the judge had misdirected the jury about dishonesty and about the proper basis for LIBOR submissions.
Legal principle
The Court of Appeal dismissed the appeal against conviction, but reduced the sentence to 11 years. Lord Thomas CJ said that the judge had been right to direct the jury that the market standards and practices of the time did not determine the standard of honesty, which was that of ordinary decent people, and that it was for the jury to decide whether the conduct was dishonest. The court also upheld the judge's direction that it was not legitimate for a submitter to take into account the commercial interests of the bank's traders in making LIBOR submissions. The convictions were later quashed by the Supreme Court in 2025, on the ground that the jury had been misdirected about the definition of LIBOR.
Related cases on financial crime, sanctions and market misconduct
- Bank Mellat v HM Treasury (No 2) [2013] UKSC 39, [2014] AC 700
- Ivey v Genting Casinos (UK) Ltd [2017] UKSC 67, [2018] AC 391
- K Ltd v National Westminster Bank plc [2006] EWCA Civ 1039, [2007] 1 WLR 311
- National Crime Agency v Baker [2020] EWHC 822 (Admin)
- National Crime Agency v Hajiyeva [2020] EWCA Civ 108
- R v Da Silva [2006] EWCA Crim 1654, [2007] 1 WLR 303
- R v GH [2015] UKSC 24, [2015] 1 WLR 2126
- R v Hayes and Palombo [2025] UKSC 29
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