DOJ lashes back at ex-Deutsche Bank traders requests for acquittal in LIBOR manipulation case

Maria Nikolova

The US Government argues that Matthew Connolly’s and Gavin Campbell Black’s motions for a judgment of acquittal or a new trial fail to identify any genuine gaps in the proof at trial.

About two months after former Deutsche Bank traders Matthew Connolly and Gavin Campbell Black, found guilty of rigging LIBOR, moved for acquittal or a new trial, the Department of Justice (DOJ) has responded to these claims.

In a set of documents filed on Monday, February 4, 2019, with the New York Southern District Court, the US Government seeks to prove that the defendants’ latest motions fail to raise any issue that warrants acquittal or a new trial. The defendants’ motions should be denied, the US authorities insist.

The DOJ explains that the jury heard more than enough evidence to find all elements of the crimes alleged against Black and Connolly beyond a reasonable doubt. The co-conspirators’ testimony also established that the defendants participated in the scheme, the DOJ says. Mr King (one of the co-conspirators), for example, described how he received requests from Gavin Black and Matthew Connolly to change Deutsche Bank’s LIBOR submissions to suit its trading positions.

Here are a couple of examples:

  • Bloomberg chat with Gurjit Dehl, in which Mr. Black asked “can we have a high 6mth libor today pls gezzer?”
  • Bloomberg chat with Mr. King, in which Mr. Black asked “COULD WE PLEASE HAVE A LOW 6MTH FIX TODAY OLD BEAN?”.

Furthermore, the DOJ argues against the defendants’ assertion about there having been a “reasonable range” within which LIBOR submitters were free to select their submissions with reference to their banks’ trading positions. The DOJ stresses that the evidence at trial did not establish such a range ever existed. According to the Government, the defendants forcefully made that argument at trial, but the jury rejected it. Mr. King, Mr. Curtler, and Mr. Parietti (the co-conspirators) all testified, not only was that not their understanding, but they had never heard the concept of a “reasonable range” until after the investigation began.

The argument about the alleged widespread practice of LIBOR manipulation at Deutsche Bank was also attacked by the DOJ. The US authorities said that “even if supervisors directed or encouraged the fraud, that is not a defense to illegal conduct.

The “I was following orders” excuse is not equivalent to a good faith defense”, DOJ says.

Also, the defendants’ attempt to shift the blame to Deutsche Bank’s training and the prevalence of the fraudulent conduct should likewise be rejected, according to the US Government. That the defendants were not specifically trained not to manipulate LIBOR is seen not to negate their fraudulent intent.

Connolly was Deutsche Bank’s director of the Pool Trading Desk in New York, where he supervised traders who traded USD LIBOR-based derivative products. Black was a director on Deutsche Bank’s Money Market and Derivatives Desk in London, who also traded USD LIBOR-based derivative products.

In October 2018, a jury convicted Connolly and Black for their participation in a scheme to manipulate the London Interbank Offered Rate (LIBOR).

  • Read this next

    Retail FX

    Weekly Roundup: FX prop firms switch to cTrader, who moved $1.35B BTC?

    The foreign exchange and cryptocurrency markets are always active, and this past week was no exception. Stay ahead with a selection of essential stories and updates that matter most to market participants.

    Digital Assets

    Bitcoin breaks all records with a massive $1.347 billion transaction

    This transaction has surpassed previous records, setting a new benchmark for Bitcoin trades. Before this event, the largest Bitcoin transactions included a $1.1 billion trade in April 2020 involving 161,500 BTC, and other significant transactions ranging from $491 million to $1.033 billion throughout 2019 and 2020.

    Digital Assets

    Uniswap debuts Ethereum ‘uni.eth’ subdomains

    Decentralized exchange platform Uniswap has integrated Ethereum Name Service (ENS), allowing users to create human-readable domain names and cryptocurrency wallet addresses using .eth endings.

    Web3

    Magic Square Expands with TruePNL Acquisition

    Binance’s web3 app store, Magic Square, acquired token platform TruePNL in a cash deal this week for an undisclosed sum. The deal brings TruePNL’s infrastructure (excluding branding & token) under Magic Square’s wing. Initially seeking a partnership, Magic Square opted for a full acquisition.

    Crypto Insider

    The Future of Prediction Markets? Zeitgeist Launches Decentralized Court System

    Polkadot-powered prediction market protocol Zeitgeist has announced the launch of its latest innovation: a decentralized court system.

    Digital Assets

    Crypto exchange Kraken fires back at SEC lawsuit, claiming overreach

    Crypto exchange Kraken is pushing back against the U.S. Securities and Exchange Commission (SEC), seeking to toss out a lawsuit that accused the platform of operating without proper registration.

    Industry News

    Exness Named a Best Place to Work in 2024

     Global leader Exness, tops in retail trading volume, earns 2024 “Best Place to Work” award, cementing its employee-centric culture after three prior years of winning the Cyprus national title.

    Digital Assets

    Swan Bitcoin taps Bakkt for crypto offering in the US

    “We are thrilled to be taking this exciting step forward in our partnership with Swan. This is just the beginning of our collaboration, as we intend to explore further growth opportunities together in the future, including expansion into international markets.”

    Digital Assets

    Polkadot Awards Bifrost a 500,000 DOT Loan to Enhance Liquid Staking Adoption

    Bifrost, a leader in liquid staking solutions, has secured a 500,000 DOT loan from Polkadot’s treasury to expand the reach and utility of its vDOT product within the ecosystem.

    <