The UK Supreme Court has overturned the convictions of former city traders Tom Hayes and Carlo Palombo, who were previously jailed for manipulating interest rates to benefit bank transactions. Hayes was seen as the “ringmaster” of the fraud and was sentenced to 11 years in 2015, while Palombo received a four-year sentence in 2019.
Both traders were part of a larger group accused of manipulating Libor and Euribor rates, which are critical for setting interest rates on various loans. Although Hayes admitted to manipulating rates, he claimed it was a common practice at his bank and insisted he was a scapegoat. Evidence later surfaced indicating that government officials and central bankers also pressured traders, yet no officials have faced charges.
After years of legal battles, the Supreme Court ruled that their trials were unfair, leading to the conviction’s dismissal. The Serious Fraud Office announced it would not seek a retrial. Following his exoneration, Hayes expressed hopes of reclaiming confiscated assets and called for a public inquiry into the justice system’s handling of such cases. His attorney criticized the dual role of some agencies in investigating and prosecuting, suggesting it leads to miscarriages of justice. The fallout from the ruling may prompt discussions in Parliament regarding banking practices and government oversight.
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