Tom Hayes Libor trial: Trader changed his mind on deal, jury told

Hayes said he had been given no compliance training and that there were 'no rules' that governed Libor

The former Libor trader Tom Hayes has been accused of using “smokescreens and red herrings” after he had second thoughts about a deal where he agreed to help the prosecution.

Prosecutor Mukul Chawla QC said Mr Hayes had told the Serious Fraud Office in 2012: “It was a dishonest scheme and I was part of it, so obviously I was being dishonest.”

Mr Chawla said: “Mr Hayes’s position then is very different from his position now. Is the reality that he simply changed his mind and now needs to supply an explanation to justify it? Was he lying then to the SFO? Is he lying now? Or is the reality that he is just a man out for himself, thoroughly dishonest, manipulative and prepared to do whatever it takes to save his own position?”

Mr Hayes is the first trader in the world to face prosecution over the London Interbank Offered Rate (Libor) scandal in which interest rates banks use to lend money to one another were fixed.

Prosecutors claim that the 35-year-old, a former UBS and Citigroup trader, was motivated by “greed” and acted as the “ringmaster” in an enormous fraud to rig Libor.

Mr Chawla said yesterday: “When you consider those issues you will see them for what they are – smokescreens and red herrings.

The prosecution say these are not the actions of an honest man conducting his business in an honest way. It is the action of someone who is prepared to cheat the people.”

The jury at Southwark Crown Court were played a recording of a call from May 2009 in which Mr Hayes appears to tell a contact that he will give him a lucrative payback. He says he will “f***ing reward you” if he helps to get the numbers up, and says: “Any favours you can call in, make sure you take the guys out for like a strip club or whatever the night before.

“You know I am always good to my word when I say I’ll make sure I will share the lump, okay.” With regard to that “lump”, Mr Chawla told the jury to “look at what is being suggested”.

The jury had earlier heard claims that Mr Hayes tried to draw a junior colleague into the plot, suggesting that they might have a word with one of the traders about changing the rate. But the attempt was rebuffed after the trader said “he could not consider any such request, that the request contravened compliance rules and that he should not make any such requests in the future”.

Mr Hayes, of Fleet, Hampshire, denies eight counts of conspiracy to defraud between 2006 and 2010.