Stewart Bishop, 14 April 2021
Two former Deutsche Bank traders on Wednesday argued that the Second Circuit should reverse their convictions for Libor-rigging, saying the government failed to prove they violated any of the applicable rules governing the benchmark interest rate.
Matthew Connolly and Gavin Black in 2018 were convicted at trial of wire fraud and conspiracy for their roles in a purported scheme to tweak lending estimates included in Libor to benefit the bank’s derivatives trading positions.
Libor, or the London Interbank Offered Rate, is a benchmark interest rate calculated from estimates from global banks of lending costs to one another for short-term loans.
Both men were sentenced to terms of home confinement — to be served in Black’s case at his home in the U.K. — despite prosecutors’ call for several years in prison for both defendants. At the time, U.S. District Judge Colleen McMahon deemed them minor players in the scheme and said she “cannot make Mr. Connolly and Mr. Black scapegoats for the sins of the entire industry.”
Connolly and Black nevertheless appealed, while prosecutors from the U.S. Department of Justice’s Criminal Division urged the Second Circuit to vacate both sentences and remand the case back for resentencing, claiming the judge committed plain error in allowing Black to serve his term of home confinement in the U.K. and that Connolly’s sentence was influenced by the improper punishment given to Black.