Former Barclays Trader Reich Interrupts Libor Proceedings

Ryan Reich, the ex-Barclays trader on trial for rigging Libor Libor Libor stands for London Inter-bank offered rate. It is an industry-specific term which most of us would never have heard of until the "Libor scandal" became popularized in 2012. Libor is considered to be one of the most important interest rates in finance, upon which trillions of financial contracts rest. The Libor rate effects over $800,000,000,000,000 in financial deals. Banks simply cannot lend money to one another whenever they like as there is a system in place. Every day a group of leading Libor stands for London Inter-bank offered rate. It is an industry-specific term which most of us would never have heard of until the "Libor scandal" became popularized in 2012. Libor is considered to be one of the most important interest rates in finance, upon which trillions of financial contracts rest. The Libor rate effects over $800,000,000,000,000 in financial deals. Banks simply cannot lend money to one another whenever they like as there is a system in place. Every day a group of leading Read this Term, was today reprimanded by the judge for shouting after interrupting a co-defendant who was being questioned by a prosecutor.

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Reich was reported to have shouted "no, no, no, no" from his seat after the prosecutor asked fellow ex-Barclays trader Alex Pabon on the stand if the Libor rate affected Swaps Swaps Swaps can be defined as a derivate contact composed of two parties that exchange to cash flow between two separate financial instruments.They are generally divided into two categories. This includes contingent claims (options) and forward claims, where forward contracts, swaps, and exchange-traded funds (ETFs) are exchanged. Commodity price, equity price, interest rate, and foreign exchange rate are common variables used as one of the cash flows in swaps upon initiation. Different Types of Swaps Swaps can be defined as a derivate contact composed of two parties that exchange to cash flow between two separate financial instruments.They are generally divided into two categories. This includes contingent claims (options) and forward claims, where forward contracts, swaps, and exchange-traded funds (ETFs) are exchanged. Commodity price, equity price, interest rate, and foreign exchange rate are common variables used as one of the cash flows in swaps upon initiation. Different Types of Swaps Read this Term valuations.

Reprimanded for Interruptions

After interrupting the proceedings, Reich’s lawyer told him to be quiet and the judge commented that “interruptions should not take place.” Pabon then answered affirmatively that Libor did affect swaps valuations.

The two traders are currently on trial with former colleagues Stylianos Contogoulas, Jay Merchant and Jonathan Mathew for conspiring from 2005 through 2007 to fix Libor, the benchmark tied to trillions of dollars in securities and loans. Another ex-trader, Peter Johnson, has pleaded guilty to the charge.

The outburst took place on the third day of Pabon’s testimony. Pabon was said to have made over 30 requests to change Barclays’s Libor submission to Contogoulas. He then allegedly passed them on to Johnson, who oversaw the bank’s rate submissions.

Pabon said that he was told by his boss, Merchant, to make the requests and didn’t think it was improper as they were also in line with the wider derivatives market.

Burned Out

Reich and Pabon worked in the New York office of Barclays with Merchant at the time the allegations were made. Pabon exhibited emotional behaviour on the stand on Thursday when he was testifying about his Barclays’ career. He described to the jury how he felt burned out at the bank and wanted to leave after several big trading losses.

He also claimed that Barclays fostered a culture where traders faced significant consequences, including firings, if they didn’t follow instructions of the bosses.

He concluded by telling the jury that after leaving Barclays later that year he moved to Texas and never worked in banking again.

The case continues.