Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Former Rabobank employee manipulated Yen LIBOR, pleads guilty, (Jun 11, 2014)

By Greg Hammond, J.D.

Takayuki Yagami, a former Japanese Yen derivatives trader for Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank), pleaded guilty to one count of conspiracy to commit wire fraud and bank fraud, the Department of Justice Antitrust Division announced. A superseding information against him was filed on June 10 (U.S. v. Yagami, Criminal No. S1:14-cr-00272-JRS)

Three other Rabobank employees were previously charged with conspiracy to commit wire fraud and bank fraud in a fifteen-count indictment earlier this year.

According to the Department of Justice, Yagami, Paul Robson, Paul Thompson, and Tetsuya Motomura traded in derivative products that referenced Yen LIBOR, an average interest rate calculated based on submissions from banks across the globe. The court filings alleged that the four former Rabobank employees agreed to make false and fraudulent Yen LIBOR submissions for the benefit of their trading positions.

“With this guilty plea, we take another significant step to hold accountable those who fraudulently manipulated the world’s cornerstone benchmark interest rate for financial gain,” stated Attorney General Eric Holder. “This conduct distorted transactions and financial products around the world. Manipulation LIBOR effectively rigs the global financial system, compromising the fairness of world markets. This plea demonstrates that the Justice Department will never waver, and we will never rest, in our determination to ensure the integrity of the marketplace and protect it from fraud.”

Rabobank reached a deferred prosecution agreement with the Department of Justice in 2013, agreeing to pay a penalty of $325 million to resolve the bank’s LIBOR submission violations. The bank has also agreed to pay $475 million to settle charges with the Commodity Futures Trading Commission, and has reached similar settlements with the Dutch Public Prosecutor’s Office and the U.K. Financial Conduct Authority.

The Antitrust Division noted that the investigation into Rabobank, its employees, and the Yen LIBOR violations is being conducted by forensic accountants, intelligence analysts, and special agents in the FBI’s Washington Field Office.

“Manipulating financial trading markets to create an unfair advantage is against the law,” stated FBI Assistant Director in Charge Valerie Parlave. “Today’s guilty plea further underscores the FBI’s ability to investigate complex international financial crimes and bring the perpetrators to justice. The Washington Field Office has committed significant time and resources including the expertise of Special Agents, forensic accountants and analysts to investigate this case along with our Department of Justice colleagues. Their efforts send a clear message to anyone contemplating financial crimes: think twice or you will face the consequences.”

News: Antitrust AntitrustDivisionNews