Andreas Hauschild, a former managing director at Deutsche and Commerzbank, was cleared by a London jury over allegations it plotted with a cartel in the euro swaps markets to rig Libor, the mechanism used to set interest rates.
In a prosecution brought by the Serious Fraud Office (SFO), Hauschild was accused of conspiring with others at Deutsche Bank, Barclays, Societe Generale and other banks between 2005 and 2009. They allegedly created a chat group to defraud in relation to manipulating Euribor, the European interbank lending rate, seeking an edge over counterparties in a five-year rate rigging plot, UK prosecutors said.
The case included Christian Bittar, a former star trader at Deutsche who has already been convicted alongside Barclays traders Philippe Moryoussef, Colin Bermingham and Carlo Palombo.
They were allegedly found to have routinely helped their London-based Deutsche Bank colleague to change the rates they submitted in order to benefit their positions, the SFO said.
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Favors on the fixings
The court papers included chat messages sent by Bittar, who had a reputation as one of the most talented moneymakers in the business, to Hauschild’s team responsible for rate submissions. Bittar was quoted as saying “Thx for your help on the fixing – was much better than I hoped for!” One of Hauschild’s team members replied, “my pleasure.” In another message, Bittar asked for “favors on the fixings,” and the same employee replied, “will do my best.”
Hauschild, a 54-year-old German resident, had his convictions overturned by the UK court on the grounds that the jury looked at the same evidence and decided not to bring charges, citing insufficient proofs for a realistic prospect of conviction.
In a statement following the decision to quash the charge, Hauschild said: “I have always maintained my innocence of the charge against me and I am very pleased that today’s decision has vindicated my position. The last several years have been very difficult for me.”
Global regulators, including FCA and its U.S. and Swiss counterparts, have fined banks and brokers around $9.0 billion and charged about 30 people in a global inquiry into how banks set rates such as Libor, which determine the rates on trillions of loans and financial contracts globally.