A former senior trader at Rabobank pleaded guilty on Monday to participating in a scheme to manipulate the yen Libor rate, becoming the second employee of the Dutch-based lender to admit guilt in a U.S. probe into alleged manipulation of interest rate benchmarks worldwide.
Paul Robson, a British citizen who also submitted Rabobank's rates used to calculate the Japanese Yen London InterBank Offered Rate, conspired to manipulate the submissions to benefit trading positions between 2006 and 2011, the U.S. Department of Justice said.
Robson entered his plea before U.S. District Judge Jed Rakoff in Manhattan to one count of a 15-count indictment he had faced. Justin Weddle, a lawyer for Robson, did not immediately respond to requests for comment.
Takayuki Yagami, another former senior trader at Rabobank, in June became the first to plead guilty for his role in the scheme.
"The scope of the fraud was massive, but the scheme was simple. By illegally influencing the Libor rates, Robson and his co-conspirators rigged the markets to ensure that their trades made money,'' Leslie Caldwell, who heads the Justice Department's criminal division, said in a statement.
Rabobank agreed last October to pay $1 billion to resolve U.S. and European probes into Libor manipulation. This included a $325 million criminal penalty for the Dutch bank and a deferred prosecution agreement with the Justice Department.
Libor, which is calculated based on submissions for a panel of banks, underpins hundreds of trillions of dollars of transactions, and is used to set interest rates on credit cards, student loans and mortgages.
U.S. and European regulators have been probing whether banks attempted to manipulate the rate to benefit their own trading positions. Nine people, including Robson, have been charged by the Justice Department.
Robson worked as a senior trader at Rabobank's money markets and short-term forwards desk in London, and also served as the bank's primary submitter for the Yen Libor calculation, the Justice Department said.
He routinely used that position to submit rates requested by Yagami and other traders, prosecutors said.
In 2007, for example, Yagami asked Robson by email for a high submission for one of the rates, Robson answered, ``no prob mate let me know your level.''
After Yagami made his request, according to the Justice Department, Robson confirmed: ``sure no prob... I'll probably get a few phone calls but no worries mate... there's bigger crooks in the market than us guys!''