Belfast Telegraph

Champagne and sweet talk... e-mails reveal trader tactics

By Jamie Grierson

Promises of Bollinger, coffees and affectionately dubbing a banker "big boy" were some of the jaw-dropping e-mails uncovered last week as part of the FSA investigation into rate-manipulation at Barclays.

The City watchdog trawled through e-mails, instant messages and phone transcripts to uncover any underhand tactics used by traders and Barclays staff to influence the rate at which banks lend to each other.

The FSA said it was clear that Barclays took traders' requests into account when setting the so-called Libor rate, with one sample showing 70% of submissions consistent with the request made.

The contents of the messages were made available in the FSA's report and provide a shocking insight into the informal and casual exchanges made between traders and rate submitters.

In one request for a change to the Libor, a trader said: "Please feel free to say 'no'.

"Coffees will be coming your way either way, just to say thank you for your help."

The Barclays submitter responded: "Done, for you big boy."

In a telephone conversation a trader complained to a manager that the Barclays employee was submitting "the highest Libor of anybody".

He added: "He's like, 'I think this is where it should be'. I'm like, 'Dude, you're killing us'."

The trader said that he had "begged" the submitter to put in a low rate and the submitter had said he would "see what I can do".

An external trader e-mailed another trader at Barclays to state: "If it (the Libor rate) comes in unchanged I'm a dead man."

The Barclays trader said he would "have a chat" and the submission was later lowered.

The external trader thanked the Barclays trader and added: "Dude, I owe you big time! Come over one day after work and I'm opening a bottle of Bollinger."

The FSA also highlighted suspicious extracts from instant messaging conversations with external traders, which included admissions such as "if you know how to keep a secret I'll bring you in on it" and "if you breathe a word of this I'm not telling you anything else".