Two former Deutsche Bank workers were indicted in the US yesterday evening on allegations of manipulating US dollar linked Libor.
Matthew Connolly, 51, of New Jersey, and Gavin Black, 46, of London, have been accused of taking part in a scheme to rig the benchmark rate so that it better suited their own or their former employer's trading positions.
The two men charged held reasonably senior roles at the bank. Connolly was Deutsche Bank's pool trading desk director in New York while Black was a director on Deutsche Bank's money market derivatives desk in London.
"This indictment charges two senior traders with manipulating Libor to gain an illegal advantage in the market," said assistant attorney general Leslie Caldwell. "Millions of people around the world rely on Libor and other global financial benchmarks as accurate and honestly-reported rates."
"Manipulation of these rates undermines the integrity of our financial system and the Justice Department will continue to hold accountable both the financial institutions and the individuals responsible for this conduct."
Deputy assistant attorney general Brent Snyder added: "Healthy financial markets are crucial to a successful economy."
However, Ken Breen, of Paul Hastings, said on behalf of his client Connolly, that the allegations were "untrue, and he looks forward to clearing his name in court".
The indictment against Connolly and Black, which consisted of one count of conspiracy to commit wire fraud and bank fraud and nine counts of wire fraud, was set out by a federal grand jury earlier the week, but the charges were not unsealed until late yesterday.
Another Deutsche Bank trader – Michael Curtler, 43, of London – has already pleaded guilty for his role in the alleged scheme. Curtler pleaded guilty to one count of conspiracy to commit wire and bank fraud last October.
Deutsche Bank itself entered into a deferred prosecution agreement relating to wire fraud and antitrust charges in April last year.