Reuters logo
Ex-Rabobank trader turned U.S. cooperating witness testifies at Libor trial
October 15, 2015 / 5:17 PM / 2 years ago

Ex-Rabobank trader turned U.S. cooperating witness testifies at Libor trial

NEW YORK, Oct 15 (Reuters) - A former Rabobank trader known within the bank as the “Ambassador” testified against two of his former colleagues on Thursday in the U.S. Justice Department’s first trial spilling out of the investigations into Libor manipulation.

Lee Stewart, 52, was the first of three onetime Rabobank traders to take the stand in the trial of Anthony Allen and Anthony Conti in Manhattan federal court after pleading guilty and agreeing to cooperate with the government.

Stewart, a former derivatives trader at Rabobank in London, told jurors that he regularly asked Conti, who sat at the same trading desk, to use his position in setting U.S. dollar Libor interest rates to help him make profitable trades tied to the benchmark.

“Generally I think he would look after me,” Stewart said.

Libor, or the London interbank offered rate, is a short-term rate banks charge each other for loans that is calculated based on submissions by a panel of banks. It underpins hundreds of trillions of dollars in financial products globally.

The case is the first by the Justice Department to go to trial following investigations by U.S. and European authorities into whether banks submitted artificial rate estimates to bolster profits on trading derivatives tied to Libor.

Those investigations resulted in charges against 22 people in the United States and United Kingdom and around $9 billion in regulatory settlements with financial institutions.

Allen, Rabobank’s former global head of liquidity and finance, and Conti, a senior trader, were indicted in October 2014 on conspiracy and wire fraud charges, a year after the Netherlands-based bank reached a $1 billion deal resolving related U.S. and European probes.

Stewart’s testimony on Thursday primarily concerned his interactions with Conti, who was the main individual at Rabobank tasked with making its U.S. dollar Libor submissions.

Stewart testified that he regularly asked Conti to make submissions favoring his trading positions, and that Conti “would help me quite a lot.”

Allen, who supervised Conti, participated in discussions about Libor and never sought to stop him from influencing it, Stewart said.

Stewart previously pleaded guilty plea in March to conspiracy to commit wire and bank fraud.

Two other ex-Rabobank traders who have pleaded guilty, Paul Robson and Takayuki Yagami, are expected to be also called as government witnesses.

The case is U.S. v. Allen, U.S. District Court, Southern District of New York, No. 14-cr-00272. (Reporting by Nate Raymond in New York; Editing by Cynthia Osterman)

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below