DOJ provides info to victims of ex-Deutsche Bank traders convicted of LIBOR manipulation

The United States Department of Justice (DOJ) has published a dedicated page related to the proceedings against Matthew Connolly and Gavin Campbell Black, former Deutsche Bank traders that were convicted by a jury of conspiring to commit wire fraud and bank fraud in connection to manipulate LIBOR in October last year.

The DOJ reminds that a sentencing hearing for the defendants is scheduled for October 24, 2019 at 10:30 AM before Judge Colleen McMahon.

If you would like to submit a Victim Impact Statement, you may do so by mailing the Victim Impact Statement below (or a letter to Judge McMahon) to: Victim Witness Unit, U.S. Department of Justice, Criminal Division, Fraud Section, 10th & Constitution Avenue, NW, Bond Building, Room 4416, Washington, DC 20530. You also may submit the Victim Impact Statement via email at [email protected] or by fax at: (202) 514-3708.

The statements have to be submitted by October 1, 2019.

Let’s recall that, in May this year, Judge Colleen McMahon of the New York Southern District Court dashed the hopes of Connolly and Black for acquittal.

In her Decision and Order, the Judge noted the heavy volume of evidence showing that Connolly and Black participated in the scheme to manipulate LIBOR. For example, in an email, Connolly requested: “If possible, we need in NY 1mo libor as low as possible next few days…tons of pays coming up overall… thanks!”. Or, for instance, a chat where Black asked: “can we have a high 6mth libor today pls gezzer?”

The Judge also stressed that the Jury heard evidence that the defendants asked Deutsche Bank submitters to change the bank’s submissions in line with their trading positions, from which jurors could easily infer that the Bank’s Libor submissions were not a true estimate of borrowing costs, but rather numbers manipulated for its financial gain. The evidence thus showed that Deutsche Bank’s LIBOR submissions were false and fraudulent statements because they did not actually reflect the conspirators’ estimates of the bank’s borrowing costs.

Further, contrary to the defendants’ assertion, the evidence at trial did not establish that LIBOR submitters were free to set their submissions within a “reasonable range” that took account of their banks’ trading positions. Importantly, the evidence showed that Deutsche Bank had a method for determining one particular rate – not a range of rates – at which it could ask and accept interbank offers for each currency and tenor, per the BBA’s definition.

The Judge also discarded the defendants’ attempt to shift the blame to Deutsche Bank’s training.

“That defendants were not specifically trained not to manipulate LIBOR does not negate their fraudulent intent, any more that does the fact that others were also doing it”.