WCG Trader Faces Probe In Barclays Libor Scandal

Aug 6 2012 | 11:38am ET

Prosecutors are eyeing a hedge fund trader in the growing probe over manipulation of the London Interbank Offered Rate.

Ryan Reich's activities during his three-and-a-half years at Barclays have drawn scrutiny, Reuters reports. Reich allegedly sent e-mails seeking information about how the benchmark Libor was to be priced.

Barclays fired Reich for the e-mails; the bank has since paid more than US$400 million to settle allegations that its employees colluded with people at other banks to manipulate Libor. Reich, who now works at WCG Management, filed an employment arbitration case against the bank after his firing; terms of its disposition are not public.

A person familiar with Reich's dismissal told Reuters that traders at Barclays had been gathering information like Reich for since the 1990s and that Reich was directed to send the e-mails in question by his superiors. "This was systemic at Barclays," the source said.

Reich worked on a Barclays desk trading interest-rate swaps on U.S. Treasuries and the U.S. and Canadian dollars. The information he allegedly sought could have been used to take profitable positions, another source told Reuters.

Prosecutors in Washington, D.C., have focused on Reich's former desk, where he worked from 2006 through 2010. The desk's head, Ritankar Pal, recently left Barclays. Prosecutors are still talking to people about plea deals and cooperation agreements, and are expected to decide whether to charge people by the end of this month or early next month.

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