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Friday, January 25, 2013
Libor Rigging : Bankers Attempts To Prevent Indentification Fail In High Court
Scores of bankers have failed in a bid to prevent their names being revealed during preliminary hearings of a High Court case centred on the rigging of a lending rate by Barclays staff.
More than 100 employees or former employees of Barclays wanted their identities kept secret during pre-trial hearings in London on Monday.
But a High Court judge ruled that identifying them was in the public interest after editors at three national newspapers, and a news agency, raised objections.
More than a dozen firms are airing grievances with Barclays in litigation which lawyers say is a “test case”.
Bosses at companies which run care homes sued after claiming that Barclays sold financial products without warning that the inter-bank lending rate on which they were based was likely to have been “undermined” by manipulation.
Barclays, which was fined for “misconduct and wrongdoing” in relation to manipulation of the London Inter-Bank Offer Rate (Libor), disputes the companies’ allegations.
Mr Justice Flaux said open justice was a “fundamental principle” of the legal system and bankers had not established that their case justified him making an exception to that rule.
“The application will be dismissed,” said the judge, after a hearing at the High Court in London.
“I simply don’t see that there is any sufficient case in principle made out, cogently or otherwise, which would justify the making of the order.”
He said he would give detailed reasons for his decision later.
Mr Justice Flaux said 106 people – who were employees or former employees of Barclays – had made the application.
He said 24 of those were on a “short list” of people believed to have been “involved”.
The email accounts of others had been provided to regulators investigating alleged Libor manipulation.
Mr Justice Flaux said the Libor case would examine “how far up the chain” responsibility went.
“That there was manipulation of Libor is clear because that is what the regulator has found and there has been a whopping great fine,” he told the court.
“The issue is how far up the chain did this go.”
A trial is expected to take place later this year or next year.
Lord Pannick QC, for the bankers, did not object to his clients being named at a trial.
But he said naming them in public at preliminary hearings would be unfair.
He said information could be revealed out of context and reports might give the wrong impression about an individual’s involvement.
Lord Pannick said his clients would have no right of reply to information which might emerge and their reputations and job prospects could be unfairly damaged.
“It is simply unfair for names of these individuals to be published by reason of these proceedings,” he told the judge.
“Fairness is a reason not to name someone who has not been heard in the proceedings.”
The Times and Telegraph newspaper groups, the Financial Times and the Bloomberg agency raised objections.
Guy Vassall-Adams, for the Times and Telegraph groups, said the Libor case was a “compelling” matter of public concern and the “sort of stuff” journalists should report.
He said courts should treat bankers like they treated everyone else and adhere to the principle of open justice.
And he told the judge that the public would think it a “joke” if identities could not be revealed.
“They may be grand. They may be wealthy. They may consider themselves above all this. They may even be able to afford Lord Pannick,” said Mr Vassall-Adams.
“But they are just like any other individuals in court proceedings up and down this country.”
He added: “What this really comes down to is a group of some wealthy individuals saying the court should depart from the normal principles covering civil litigation.”
Mr Justice Flaux said one problem might have been be deciding how to refer to bankers if names could not be used in open court.
He added: “We would have to refer to the chief executive as, I don’t know, the ‘head rabbit’ or something.”