In a landmark case, 35yo Hayes was convicted of eight counts of conspiracy to defraud.
Sentencing him at London’s Southwark crown court, Mr Justice Cooke said: “The conduct involved here is to be marked out as dishonest and wrong and a message sent to the world of banking accordingly. The reputation of Libor is important to the city as a financial sector and the banking institutions of the City.
Tom Hayes arrives at Southwark crown court with his wife Sarah.
“Probity and honesty is essential as is trust. The Libor activity of which you played a leading part put all that in jeopardy.”
When the judge announced his sentence, Hayes – dressed in a light blue shirt and dark blue jumper with black slacks – put his head in his hands and ran his hands through his hair. During the reading of the judgement he shook his head repeatedly.
Hayes was sentenced to nine-and-a-half years for each of the first four offences to run concurrently and four-and-a-half years for each of the second four. These will run consecutively to total 14 years.
Hayes, from Fleet, Hampshire, was accused of being the ringleader in a vast conspiracy to fix the London interbank offered rate (Libor), a benchmark for $450tn (£290tn) of financial contracts and loans worldwide, between 2006 and 2010.
Motivated by greed and a desire for higher pay, the court heard that Hayes set up a network of brokers and traders that spanned 10 of the world’s most powerful financial institutions, cajoling and at times bribing them to help rig rates – designed to reflect the cost of interbank borrowing – for profit. Hayes would then place large bets on financial markets that were sensitive to Libor moves.
The former trader, who was diagnosed with mild Asperger syndrome just before his trial began, said he was transparent about trying to influence rates and his managers were aware.
But a jury of seven men and five women rejected his defence and found him guilty on all eight counts.
The case was seen as a big test for the Serious Fraud Office and its effectiveness in policing banking fraud.
Hayes claimed he was taking part in an “industry-wide” practice. He described the broking market he worked in as the wild west, a place with no rules and where relationships relied on lavish entertainment. He said it was this high-pressure environment which took its toll on him, prompting him to threaten brokers and pick fights with colleagues to move interest rates to aid his trading.
The Canary Wharf financial district is seen in east London.
Hayes is the first person to stand trial for alleged manipulation of Libor. He was arrested in December 2012 and questioned by the Serious Fraud Office. He told SFO investigators that his trades had earned £150m for UBS in a three year period.
He said he originally confessed to misconduct in 2013 after being “frozen with fear” that he would be extradited to America. He said he did not believe he had acted dishonestly with regard to Libor and that he wanted to do his job “as perfectly” as he could.
US prosecutors wanted to charge Hayes on three counts of conspiracy to fraud, with each one carrying a 20 to 30-year sentence.
He subsequently withdrew from a co-operation agreement with the SFO and in December 2013 pleaded not guilty.