Unfair trade: banker who took the rap for Libor walks free

The case of Tom Hayes, who had his Libor conviction overturned last week, raises serious questions about the justice system.

- By Barney Macintyre

The first nine to 12 months of prison is survival. A sort of surreal out-of-body experience, almost like it’s not happening to you. The moment I got my conviction overturned, it felt very similar.”

In 2015, at the age of 35, the former City trader Tom Hayes was sentenced to 14 years in prison after being found guilty of manipulating Libor, which was the world’s most widely used interest rate benchmark.

Last week the Supreme Court overturned the ruling. Five judges unanimously found Hayes’s conviction unsafe and said that the history of his case raised serious concerns about the effectiveness of the criminal justice system and, in particular, the process of appeal.

The quashing of Hayes’s conviction and that of Carlo Palombo, a former Barclays trader, threatens to reopen a Pandora’s box of recriminations that arose in the wake of the 2008 financial crisis, when banks and regulators were seeking to rebuild creditworthiness in the eyes of the public.

It also calls into question the cases of seven other traders convicted of Libor rigging, four of whom have already said they intend to appeal following the Supreme Court’s decision. Hayes says that every one of these convictions now “needs to go”.

Sitting in an office in Temple, wearing a T-shirt emblazoned with a quote from the crime drama The Gambler, it’s evident that Hayes is worn out from the ordeal. Hayes got out in January 2021, but during the five and half years he spent in Belmarsh high-security prison, the ex-UBS trader underwent the end of his marriage, mental health struggles, a conversion to God and the pain of having to watch his son become a teenager through a piece of Perspex.