Confrontation vs co-operation
28 January 2014
19 February 2014
16 August 2013
9 April 2014
22 August 2013
16 December 2013
Michelmores partner Andrew Oldland QC discusses the great LIBOR plea dilemma facing the SFO
As further details emerge of the investigations into LIBOR fixing, a picture of a global network of conspiracies to beat all conspiracies is emerging.
The sheer scale and international reach of LIBOR fixing by bank and trading house employees presents a number of problems for prosecutors, foremost of which is case management.
In the UK concerns over the manageability of large fraud cases came to the fore in the wake of cases such as Guinness and Blue Arrow in the early 1990s.
Since then prosecutors have been encouraged to jettison relevant evidence in favour of brevity and clarity for juries and, where necessary, courts have ordered severance of defendants or of counts to the same end.
The news in the past month that ex-UBS and Citibank trader Tom Hayes and his co-defendants Terry Farr and James Gilmour were pleading not guilty to the charges that they faced, would have been unwelcome news to the SFO.
In complex conspiracy cases, guilty pleas are gold dust for prosecutors; not only can such convictions prove the existence of the alleged conspiracy, but they can also make cases much more manageable as multi-defendant trials are reduced in scope and complexity by fewer defendants and fewer issues.
The SFO has decided that Hayes will face trial first and on his own. This is unusual and not without risk. Even Farr and Gilmour will be tried at a later date.
It may indicate that the SFO is confident in the strength of the evidence it has against Hayes, but it means that the jury will not hear evidence from any others alleged to have been involved with Hayes. Hayes can say what he likes about these others without any challenge from them.
Is this simply an extreme form of case management or have other factors contributed to the SFO’s decision to try Hayes on his own?
The recent decision by the US Department of Justice (DoJ) to charge Paul Robson and two other former Rabobank employees is likely to be equally unwelcome news for the SFO. London-based Robson is under investigation by the SFO and has previously been named as an alleged co-conspirator with Hayes.
In December 2012 the SFO had an unseemly tussle with the DoJ over Hayes, when the DoJ charged Hayes prompting the SFO decision to charge days later so as to thwart any US extradition request.
Publicly the US and UK authorities hold themselves out as cooperating fully over LIBOR, but this does not appear to extend to the prosecuting agencies. The SFO may again find itself being bounced into charging before it is ready.
Once charges are brought the SFO loses control of its timetable to the courts, so there is a risk that decisions about who is to be tried when and with whom are being pre-empted by the actions of the DoJ.
Only time will tell what damage, if any, this will have on the SFO’s prospects of success. The SFO’s future could well depend on the outcome of Hayes’ trial in early 2015. If Hayes were acquitted and it emerged that the SFO was forced to act before it was ready, relations between US and UK prosecutors could be soured for years to come.
In the meantime, Robson is no doubt hoping and praying for an SFO knock on the door.