Wednesday 3 April 2024

R v Hayes and Palombo ~ LIBOR banking back in the news

   Almost 12 years ago, this blog discussed the 'LIBOR banking' situation and noted that the Serious Fraud Office (SFO) was then close to bringing criminal charges.

By way of a brief reminder, LIBOR was the abbreviation for the London Interbank Offered Rate. Money market traders found themselves able to earn money for their bank (and, through their personal pay structure, for themselves) by subtle manipulations of the rate.  Very small alterations in the rate equated to considerable sums of money.  The process was well described by Alex Bailin QC (now KC) in The Guardian 4th July 2012 The Law catches up with LIBOR

In 2015,

Mr Tom Hayes (BBC 3 August 2015) was convicted on 8 counts of conspiracy to defraud - (Sentencing remarks of Cooke J). The activities of Hayes concerned LIBOR rates set for the YEN (¥ ).  Cooke J said that the case had shown the "absence of integrity which ought to characterise banking." 

A central issue at trial was whether Mr Hayes had acted 'dishonestly' according to the test in R v GHOSH [1982] 1 QB 1053 which then applied. 

In December 2015, the Court of Appeal (Criminal Division) dismissed Mr Hayes' appeal but reduced the sentence to 11 years imprisonment - R v Hayes [2015] EWCA Crim 1944. 

On 26 March 2019, Mr Carlo Palombo was convicted (by a majority of 10 to 2) following a retrial and he was sentenced to 4 years' imprisonment. His appeal was dismissed in December 2020 -  R v Bermingham and Palombo - [2020] EWCA Crim 1662 (09 December 2020) (

The cases of Hayes and Palombo recently returned to the Court of Appeal (Criminal Division) - R -v- Tom Hayes and Carlo Palombo - Courts and Tribunals Judiciary or on Bailii at Hayes & Anor v Rex [2024] EWCA Crim 304 (27 March 2024) ( The Criminal Cases Review Commission had referred the Appellants' convictions tbecause the United States Court of Appeals had adopted a different construction of LIBOR from that adopted by the Court of Appeal in London.

Both appeals failed. One reason for this was that previous Court of Appeal decisions had treated the interpretation of LIBOR as a question of law and therefore a matter for the trial judge and not the jury. The Court was bound by those previous decisions.

There is now some pressure for the case to go to the Supreme Court - Interest rate rigging appeal must go to top court, say politicians - BBC News. - and the Appellants have 14 days (from 27 March) in which to submit any application for a such a further appeal.

If such an application is made, it is possible for the Court of Appeal to refuse to certify that there is a point of law of general public importance. The Court of Appeal is therefore in a position to prevent the further appeal. Criminal Appeals Act 1968 applies.

The question of whether an appeal to the Supreme Court is possible is discussed by Joshua Rozenberg on his substack - Who has the last word? - by Joshua Rozenberg (

Since the English courts insist that the interpretation of a scheme such as LIBOR is a 'question of law' then one might naturally think that the case should go to the Supreme Court which is in a position to either affirm the existing Court of Appeal interpretation or to adopt the USA interpretation. 


Interest rate rigging appeal must go to top court, say politicians - BBC News

As for LIBOR itself, it received the final coup de grace in 2023 - Announcements on the end of LIBOR | Bank of England

The test for dishonesty as set out in R v Ghosh has been replaced by the Supreme Court decision in Ivey v Genting Casinos (UK) Ltd t/a Crockfords [2017] UKSC 67.

Previous posts

4 August 2015 - Law and Lawyers: LIBOR ~ "Absence of integrity which ought to characterise banking" - (per Cooke J) (

23 December 2015 - Law and Lawyers: LIBOR banker's appeal dismissed (

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