Econintersect: A Reuters article appearing in Wall Street & Technology states that at least one person is cooperating with U.S. officials engaged in a criminal probe of Barclays’ LIBOR (London Interbank Offer Rate) interest rate fixing scandal. Ryan Reich was a former Barclays trader who was fired by the bank for “inappropriate e-mails” seeking internal bank information about how LIBOR rates would be priced before announcement to the public. According to reports (Huffington Post), Reich engaged in this activity for a period of four years before being fired. Reich is currently a hedge fund manager with WCG Management, a New York based company.
Picture shows recent Economist cover. Click on picture for larger image.
A Reuters article in the Huffington Post states that Reich’s supervisors knew of his activities and was in fact acting on their directions. An unnamed source told Reuters that the practice of making the e-mail enquiries went back to the 1990s and traders saw nothing wrong because employers and regulators had some knowledge of the practice.
Reich was a junior trader at Barclays New York office. He graduated from Princeton in 2006 and joined Barclays in 2008. Thus he was apparently at the lowest level of the Libor fixing – insider trading operation and would be a like a loose end of yarn in a sweater that could unravel the entire garment if it is pulled.
- Former Barclays’ Trader ‘Has Cooperated’ with Libor Probe (Reuters, Wall Street & Technology, 13 August 2012)
- Fired Barclays Trader’s Activities From As Early As 2006 Draw Scrutiny in Libor Investigation (CORRECTED) (Jennifer Ablan, Matthew Goldstein and Carrick Mollenkamp, Reuters, Huffington Post, 04 and 10 August 2012)
- Ryan Reich, Ex-Barclays Trader Fired For Libor Emails, ‘Has Cooperated’ With Feds’ Probe, Email Says (Matthew Goldstein and Jennifer Ablan, Reuters, Huffington Post, 11 August 2012)