Ex-Barclays Trader Gets Appeal Bid Over Rate Rigging Charge

An ex-Barclays Plc trader jailed in 2019 for manipulating a key interest rate benchmark has won the right to appeal his conviction.

(Bloomberg) — An ex-Barclays Plc trader jailed in 2019 for manipulating a key interest rate benchmark has won the right to appeal his conviction. 

The Criminal Cases Review Commission has referred Carlo Palombo’s conviction to the Court of Appeal, Palombo’s lawyer Ben Rose, said. The referral follows a similar decision in July on Tom Hayes, the former star trader who became the face of the Libor scandal. 

Palombo, 44, was sentenced to four years in prison and released in 2021. The convictions were part of the UK Serious Fraud Office’s probe into efforts to manipulate the Euro interbank offered rate, which is related to trillions of dollars worth of loans and derivatives.

“This is everything for me,” Palombo said in an interview. “Trying to undo this conviction, from a personal and emotional perspective, and from sense of belonging to society and whether there is any justice in the world, it’s the only thing that give will me a meaningful life.” 

The rigging of Libor and Euribor by traders seeking to bolster their positions were among the most high-profile crimes prosecuted in the wake of the 2008 financial crisis. A dozen banks paid penalties approaching $10 billion for rigging the benchmarks.

Palombo was living in California with his wife and teaching at a university when he was summoned back to the UK. Today he is raising his four-year-old daughter with his wife in north London and completing a PhD in psychosocial studies at Birkbeck University. 

“I can’t drive a car because I’m not allowed insurance, I can’t have a credit card or a bank account. We live in this constant situation where we try to do things but can’t because I’m a criminal,” he said.

A New York judge dismissed the case against Hayes last year after US prosecutors accepted there was no provable case. It followed an appeal court decision to overturn the convictions of two Deutsche Bank AG traders over interest rate fixing. 

 “Following on from the Hayes referral and bearing in mind the similarity of issues we have concluded that the Court of Appeal will consider the Euribor rules in the same way, reasoning by close analogy with the US court decision,” said Helen Pitcher, chair of the CCRC.

Rose said in an interview with Bloomberg that he was optimistic that the Court of Appeal would hear Hayes’s and Palombo’s cases next year. 

“Historically criminal investigations and prosecutions driven by a public outcry have a terrible tendency to go wrong,” he said. “The world has moved on to a considerable degree and the radically different approach taken by the US courts to alleged Libor manipulation demonstrates the need to revisit the convictions.”

(Updates with a comment from the CCRC in the ninth paragraph)

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