Tag Archives: Barclays

Fed Wants $1.2M Fine, Ban For Ex-Barclays Forex Trader

Law360, New York (August 29, 2016, 3:00 PM ET) — Barclays PLC’s former global head of its foreign exchange spot business should be fined $1.2 million and banned from the banking industry after using chat rooms with competitors to manipulate the market, the Federal Reserve Board said Monday.

Christopher Ashton’s “personal dishonesty” and disregard for his employer constitute unsafe and unsound banking practices and a breach of fiduciary duty under the Federal Deposit Insurance Act, the board said in its notice. The London-based trader was fired in May 2015 for misconduct while the bank pled guilty to criminal…

Source: Law360

Barclays reaches $100 million U.S. Libor settlement – NY attorney general

Barclays (>> Barclays PLC) has reached a $100 million (£76.70 million) multi-state settlement over charges that it manipulated the Libor and Euribor interest rate benchmarks, New York Attorney General Eric Schneiderman said on Monday.

The settlement with 44 states marks the latest in a series of enforcement actions the bank has faced in connection with Libor manipulation.

Barclays is the first of several banks under investigation by state attorneys general to reach a settlement, Schneiderman said in a statement, adding that the bank cooperated with the multi-state probe.

He said government entities and non-profits were “defrauded of millions” when they entered into swap contracts with Barclays as a result of the rate-rigging.

In 2012, Barclays reached a $453 million agreement with the U.S. Justice Department, the Commodity Futures Trading Commission and British authorities to settle parallel charges.

As part of its agreement with the Justice Department, Barclays admitted to wrongdoing that occurred between August 2005 and May 2008, when some of its traders called their counterparts at competing institutions and colluded to submit Libor rates that benefited their trading positions.

“Barclays is pleased to have resolved the state attorneys’ general investigation into Barclays’ legacy LIBOR- and Euribor-related activities,” a Barclays spokesman said.

“We believe this settlement is in the best interests of our shareholders and clients, and allows us to continue to focus on the future and serve our clients.”

Read on.

Barclays triumphs in toxic mortgage bond row with U.S. Bank, FHFA

Barclays Bank and a defunct subprime lending unit of the company are off the hook for allegedly misrepresenting the quality of the mortgages that made up a $619 million mortgage bond after the Supreme Court of the state of New York ruled that U.S. Bankand the Federal Housing Finance Agency waited too long to file a lawsuit against Barclays.

Law360 first reported the news of the dismissal.

According to court documents, Judge Marcy Friedman ruled recently that U.S. Bank, acting as the trustee for Structured Asset Securities Corporation Mortgage Loan Trust, and the FHFA, acting as the conservator for Freddie Mac, filed suit against Barclays and the now-shuttered EquiFirst beyond the statute of limitations, and is therefore dismissing the lawsuit.

Read on.

Barclays : Ex-Lehman trader loses bid for $83 million ‘windfall’ bonus – judge

A federal judge on Wednesday said a former star Lehman Brothers Holdings Inc trader was not entitled to an $83 million (£64.4 million) bonus he claimed he was owed following the investment bank’s 2008 collapse, on top of a similar sum that Barclays Plc already paid him.

U.S. District Judge Lorna Schofield in Manhattan also said the former trader Jonathan Hoffman did not deserve $7.7 million that a federal bankruptcy judge had said he could recoup from the estate of Lehman’s brokerage unit, Lehman Brothers Inc, based on an unpaid instalment from his 2007 bonus.

Hoffman’s quest for additional pay is one of the largest lawsuits left in the wind-down of Lehman, whose Sept. 15, 2008 bankruptcy remains the biggest in U.S. history and helped trigger a global financial crisis.

Read on.

Libor Fixing: Ex-Barclays Traders Found Guilty

Three former Barclays traders have been found guilty of conspiring to fraudulently manipulate global benchmark interest rates.

Jay Merchant, 45, a trader and the most senior of the men on trial, was convicted unanimously at Southwark Crown Court.

Former Libor submitter Jonathan Mathew, 35, and former trader Alex Pabon, a 38-year-old American, were found guilty by a majority verdict after the 10-week trial.

The Serious Fraud Office (SFO) claimed the men were dishonest when they submitted or asked colleagues to submit Libor rates that would benefit trading positions and prejudice the economic interests of others.

Read on.

Bankers, Not Banks, on Trial in Barclays Libor Case, SFO Says

A London prosecutor told jurors they didn’t have to decide whether the banking industry as a whole is guilty of fraud, but just the five former Barclays Plc traders accused of manipulating Libor.

James Hines, a prosecutor for the Serious Fraud Office, made the argument Wednesday as he asked the jurors to disregard testimony by the five bankers that manipulation of benchmarks was an everyday occurrence, not only in the bank but also across the City of London.

“The banking industry isn’t on trial, it is a handful of dishonest traders,” Hines said on the second day of his closing argument.

Alex Pabon, Stylianos Contogoulas, Jay Merchant, Jonathan Mathew and Ryan Reich are on trial for conspiring to fix the London interbank offered rate, a benchmark tied to trillions of dollars in securities and loans, between 2005 and 2007. They face as long as 10 years in prison if convicted.

Merchant, in particular, said the culture of making the requests was fostered by senior managers at the bank despite there being no e-mail or documentary evidence they instructed traders to act dishonestly, Hines said.

Read on.

Barclays Director Arrested For Giving Plumber Trading Tips in Exchange for Home Renovations

Bloomberg reports:

A former Barclays Plc director was accused by the U.S. of giving tips about future mergers and acquisitions to a plumber friend in exchange for cash and home renovations.

 

Steven McClatchey, 58, who worked in the investment-banking division, told the plumber about 11 impending mergers and acquisitions from March 2014 to August 2015, the government said. The plumber wasn’t named.

 

McClatchey and the plumber met in 2011 or 2012 at the Long Island marina where both dock their boats, according to the complaint. By 2013, they spent most Saturdays at the marina or, in cold weather, playing pool and watching sports in McClatchey’s garage. The plumber used tips from McClatchey to make $76,000 trading stocks including Questor Pharmaceuticals Inc., PetSmart Inc., Emulex Corp. and Omnicare Inc., the government said.

The WSJ adds:

Steven McClatchey, 58, was a former employee at Barclays, the bank confirmed. Prosecutors said he worked for seven years at the Manhattan office of Barclays, where he was responsible for tracking the bank’s involvement in potential mergers and acquisitions. He distributed a weekly document to select Barclays employees called “M&A Global Weekly Business Update,” which included deals that were likely to become public the following week.

 

Government officials allege Mr. McClatchey gave tips to his friend who worked as a plumber ahead of more than 10 separate mergers and acquisitions before they became public, including deals involving PetSmart Inc., CVS Health Corp. and Duke Energy Corp.

 

The plumber allegedly paid Mr. McClatchey, in part, by providing “home renovation” services free of charge.

* * *

The two men became friends about four years ago, when they met at the Long Island marina where they both docked their boats. They began to spend most Saturdays together, the complaint said. The first tip Mr. McClatchey gave Mr. Pusey came around 2013 or 2014, when Mr. McClatchey allegedly told the plumber to “keep an eye on a particular company because something good was going to happen,” according to the complaint. Based on the tips, Mr. Pusey bought securities in at least 11 companies, prosecutors said.