Trader wrongly jailed for rate-rigging may sue for millions

Yahoo

24-07-2025

A former Libor trader jailed for rate-rigging is considering suing for compensation after his conviction was quashed by the Supreme Court.
Tom Hayes, who served five and a half years in prison for fraud, said he would seek legal advice on bringing civil claims after his 2015 conviction was overturned on Wednesday. Possible targets of legal action could include the banks that employed him before he was arrested.
Mr Hayes said: 'Whether I have any civil claims against any parties is yet to be determined. I'm not ruling it out, but I don't have sufficient information yet. I need to take advice.
'I can't at this moment in time know what I'm going to do. All I would say is that everyone in the US who had their convictions overturned, almost to a man, sued their former employer banks and reached settlements.'
Karen Todner, Mr Hayes's lawyer, said he was investigating whether to bring a possible claim against various authorities. She said there was a high probability he would launch a claim.
Lawyers said Mr Hayes could potentially win millions in compensation from various parties involved in the case, including the Serious Fraud Office (SFO), which prosecuted him, and his ex-employers, based on loss of earnings.
Deutsche Bank last July settled a $150m (£111m) lawsuit brought against it by one of its ex-traders, Matthew Connolly, whose conviction for Libor fixing was overturned in 2022.
Mr Hayes was paid more than £1m over the three years he worked at UBS and another £3.5m for the nine months he spent at Citigroup after moving to the bank in 2009.
UBS declined to comment. Citigroup declined to comment.
Mr Hayes was originally found guilty of fixing the Libor rate at UBS and Citigroup between 2006 and 2010. Libor was once used to price more than £270tn of financial products globally, including car loans and mortgages.
The Court of Appeal blocked his case from reaching the Supreme Court five times between 2015 and 2019 despite mounting public concerns about the conviction.
On Wednesday, Mr Hayes ended a 10-year battle to overturn his conviction after the Supreme Court ruled that he was denied a fair trial because of 'misdirection' of the jury in the case.
Missed son's childhood
Following the ruling, Mr Hayes said his wrongful imprisonment had destroyed his family, led to the end of his marriage and meant he missed 'most of my son's childhood'.
Former convicts who have suffered miscarriages of justice can claim compensation from the Government under a statutory scheme, but Mr Hayes said he had little hope of getting any money back.
'I have no confidence the British Government will give me anything because of the way the law's structured, so I'm sort of at peace with that,' he said.
'I would say the bigger focus for me right now is making sure that all the seven people who were convicted have their convictions overturned.
'If I sue the banks and the banks paid me some money, it just moves on. It doesn't mean anything to the bank. It's just the course of business.
'It might make me happy for a while, but I'd rather I left a better criminal appeals system than I got some money from a bank.'
Febrile anti-banking environment
The Libor rigging scandal emerged in the aftermath of the 2008-09 financial crisis amid a febrile anti-banking environment in New York and London.
Authorities pursued several traders for allegedly rigging Libor, or the London interbank offered rate, by submitting false or inaccurate rates to benefit banks.
Mr Hayes was one of nine City traders jailed in Britain related to the practice while 11 others were acquitted.
Convictions have been increasingly called into question after allegations emerged that the Bank of England had pressured banks to artificially lower the rate during the financial crisis.
Carlo Palombo, the former vice-president of euro rates at Barclays bank who was sentenced to four years for Libor fixing in 2019, had his conviction overturned alongside Mr Hayes on Wednesday.
At a press conference on Wednesday, Mr Hayes called for all seven of the remaining convictions to be overturned.
He said his biggest concern was pursuing justice. Mr Hayes said: 'You can't help but revise your view about what is important when you've been stuck in a concrete box for five and a half years. For me, the great joy is being exonerated and being free.'
Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.