DOJ does not oppose ex-Deutsche Bank trader’s attempt to detach himself from LIBOR-rigging conspiracy
The wire fraud charges, however, will not be affected by evidence that Matthew Connolly withdrew from the alleged conspiracy when he left Deutsche Bank in March 2008.
The United States Department of Justice (DOJ) does not oppose a motion by Matthew Connolly, a former Deutsche Bank trader, to present evidence of his withdrawal from an alleged conspiracy to rig LIBOR.
Connolly says he left his employment at Deutsche Bank AG in March 2008, whereas the Indictment charges a conspiracy from “in or about 2004 through in or about 2011”. According to the defense, “Connolly’s complete detachment from Deutsche Bank after his departure in 2008 is clear evidence of his disavowal of, and withdrawal from, the alleged conspiracy, and the jury should be allowed to make that determination”.
In a document filed with the New York Southern District Court on Monday, May 7, 2018, the DOJ said the US Government “does not object to the defendant offering evidence of his departure from Deutsche Bank at trial, as long as the evidence is not used for an improper purpose”.
Connolly is charged with one count of conspiracy to commit wire fraud affecting a financial institution and bank fraud, in violation of 18 U.S.C. § 1349 (Count 1), and seven counts of wire fraud affecting a financial institution, in violation of 18 U.S.C. § 1343 (Counts 2-3, 5, and 7-10). Each offense carries a 10-year statute of limitations (a statute prescribing a period of limitation for the bringing of actions of certain kinds.).
According to the Government, Connolly would not escape the charges even if he were to have “withdrawn” from the conspiracy when he left the bank in 2008. Under the conspiracy count, the defendant and his coconspirators engaged in overt acts before he left the bank.
Only the conspiracy count (Count 1) could be implicated by withdrawal because the conspiracy continued after March 2008. The Government notes, however, the conspiracy count is not pled in the alternative, i.e., the defendant is charged with a conspiracy to commit wire fraud affecting a financial institution and to commit bank fraud (10-year limitations period), but he is not charged with conspiracy not affecting a financial institution (5-year limitations period). Given that the defendant allegedly withdrew in March 2008—less than 10 years but more than 5 years before the 2016 indictment—any such withdrawal would be irrelevant.
The Indictment alleges that the former Deutsche Bank traders – Matthew Connolly and Gavin Campbell Black, schemed to manipulate LIBOR by making false and fraudulent submissions that were intended to increase the profits (or reduce the losses) owed to Deutsche Bank at the expense of the bank’s counterparties to the derivatives-based contracts.
