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Exclusive: Former Barclays merchant "has cooperated" with Libor probe

Fri Aug 10, 2012 4:02pm EDT

NEW YORK (Reuters) – A former Barclays Plc merchant who was discharged by a bank for promulgation inapt emails about Libor “has cooperated” with a sovereign rapist examine into a purported paraphernalia of general benchmark seductiveness rates, according to a New York sidestep account that now employs a trader.

The sidestep fund, WCG Management, sent an email to a investors on Sunday informing them that a $3.4 billion account is not underneath review in a Libor probe, though reliable that portfolio manager Ryan Reich has drawn inspection from U.S. prosecutors.

WCG pronounced in a email, a duplicate of that was review to Reuters by a chairman who perceived it, that a account had talked to Reich’s attorney, and a counsel pronounced his customer had “cooperated” with sovereign prosecutors.

The sidestep account combined that Reich’s counsel pronounced sovereign authorities have not asked any questions about Reich’s work for WCG, where he has been a portfolio manager given Jul 2010.

A orator for a Department of Justice declined to comment.

Kenneth Ulbricht, a arch handling officer for WCG, did not respond to requests for criticism on a sidestep fund’s email to investors. Reich’s lawyer, Ira Lee Sorkin, a partner in a white collar invulnerability organisation during Lowenstein Sandler, declined to criticism on a sidestep fund’s email.

Reuters final week reported that Reich was sketch inspection from sovereign prosecutors in Washington, D.C., after being discharged from Barclays in Mar 2010 for allegedly promulgation inapt emails seeking information concerning a pricing of Libor, information that could have been used in his trade positions.

In a financier email, WCG, referenced a Reuters story.

Libor, a London interbank offering rate, is used to set rates on trillions of dollars of contracts for all from home mortgages to credit cards. The review has inextricable banks on both sides of a Atlantic and involves yen and euro rates as good as those for a dollar.

So far, there’s no denote a authorities are looking during sidestep supports in a Libor probe, though a financier email from WCG is an denote that a sprawling review is rattling nerves over a trade desks of large banks.

Lawyers informed with a review contend sovereign prosecutors continue to strech out to people to sign seductiveness in auxiliary or holding pleas. They pronounced prosecutors are approaching to start creation decisions on charging people after this month or in early September.

When Reich worked during Barclays, he was a comparatively youth merchant on a firm’s U.S. dollar swaps trade table in New York. He assimilated Barclays in 2006, dual years after graduating from Princeton University.

Barclays, as is prevalent in a brokerage business, told a Financial Industry Regulatory Authority that it had discharged Reich for promulgation inapt inner emails while during a bank.

People informed with a review pronounced that Reich could be a pivotal declare for sovereign prosecutors as they try to build a box opposite people who allegedly attempted to manipulate Libor rates during Barclays.

Reich’s lawyer, Sorkin, is a former sovereign prosecutor and tip counsel for a Securities and Exchange Commission and has represented a series of important clients over a years, including Bernard Madoff.

One of Reich’s supervisors during Barclays was Jay V. Merchant, who left a bank during a finish of 2009 to join UBS to run that firm’s swaps table in Stamford, Connecticut. Reuters formerly reported that Merchant also has drawn inspection in a probe, that also involves regulators in a United States and a United Kingdom.

John Kenney, Merchant’s lawyer, declined to comment. A mouthpiece for UBS pronounced Merchant is to lapse Monday from vacation.

A chairman informed with WCG, that was founded in 2007 by Barry Wittlin, a former tip exclusive merchant during Merrill Lynch, pronounced a account has no skeleton to reassign Reich since it believes he has finished zero inapt during a fund.

WCG is a macro sidestep account that specializes in trade bonds, currencies and seductiveness rate swaps. With leverage, a account controls about $13 billion assets, according to regulatory filings.

Not all supports have been as active as WCG in seeking to encourage clients about a fallout from a Libor probe.

Several of a world’s largest tellurian macro managers have spent months trawling by emails, voicemails and phone calls to check that their traders did zero untoward, investors say, though this emerged usually after those same investors pulpy a supports to uncover they are purify and that there are no nasty surprises headed their way.

Most funds, when pulpy on a investigation, have declined to comment.

(Additional stating by Tommy Wilkes in London and Carrick Mollenkamp in New York; Editing by Leslie Adler)

Source: Article Source

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