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US court overturns Libor convictions after ‘forced’ FCA evidence

Convictions for two UK ex-traders have been thrown out due to use of “compelled testimony” given to the FCA

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An US court has voided convictions for UK former traders at Dutch firm Rabobank for Libor rigging in the US.

Anthony Allen and Anthony Conti were sentenced to two years and one year in prison respectively on fraud and conspiracy charges for US dollar and Japanese yen Libor in 2015, the Telegraph reports.

But the charges have been overturned by a court appeal that argued their right against self-incrimination had been violated during their trial.

The New York appeals court ruled the US Department of Justice had used testimony that the pair had been forced to give to the FCA which is considered a violation of their rights under the fifth amendment of the US constitution.

Judge Jose Cabranes wrote in the ruling:“The fifth amendment’s prohibition on the use of compelled testimony in American criminal proceedings applies even when a foreign sovereign has compelled the testimony.”

Banks use Libor interest rate benchmark to set rates on hundreds of trillions of dollars of mortgages, credit cards and other loans.

Several banks, including Rabobank, have paid around $9bn to resolve Libor-rigging probes worldwide.

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Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. Since when do the US courts care about how testimony was obtained? Standard practice in financial cases is to threaten anyone they can get their hands on with decades in a maximum security prison regardless of their innocence unless they confess and incriminate others (see NatWest Three, and Prisoner’s Dilemma while you’re on Wikipedia). The Fifth Amendment never seems to be a problem.

    It’s not as if the FCA applied thumbscrews (as far as I know).

    • The examples you cite are not “forced”, they are coerced. The 5th applies in this scenario, because if the traders did not supply the information to the FCA, they would be imprisoned/fined for not supplying it, even though it incriminated them.

      Under US law, nobody can be imprisoned or fined for not supplying information that might incriminate them.

      I believe that in the UK that right also exists, but, because British constitutional law is spread across lots of documents, spread over centuries there are gaps.

      It’s all down to the principle that if you wish to say someone has done wrong, it’s down to the government/judiciary to prove that’s the case, rather than threaten someone with prison if they don’t incriminate themselves.

      Personally my viewpoint is that the 5th is 100% solid principle, otherwise you end up with potentially despotic governments that can ride roughshod over anyone to enforce what they want, regardless of whether they are right or not.

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