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LONDON. — Britain’s Serious Fraud Office yesterday charged three former employees of Barclays over the Libor interest rate-rigging scandal, dealing a fresh blow to the embattled banking giant. The scandal over Libor, an interest rate at the heart of the global economy, has badly damaged the reputation of London’s financial centre and several big names in world banking, notably British bank Barclays.

The Serious Fraud Office said it had launched criminal proceedings “in connection with the manipulation of Libor”, while the three are alleged to have “conspired to defraud between 1 June 2005 and 31 August 2007”.

The charged were named as Peter Charles Johnson, Jonathan James Mathew and Stylianos Contogoulas in a brief statement issued by the SFO.

The trio will appear at London’s Westminster Magistrates’ Court at a date to be decided. Barclays made no official reaction, while its share price was 0.81-percent higher at 255 pence in London afternoon trading.

Yesterday’s announcement brings to six the total number of people charged by the SFO over the Libor affair.
The SFO in July charged Terry Farr and James Gilmour, former brokers at RP Martin Holdings Limited with conspiring to manipulate the Libor interbank lending rate. That came one month after it filed similar charges against former UBS and Citigroup trader Tom Hayes.

All three have pleaded not guilty to the charges they face and will stand trial next year. Former traders have been charged also in the US over alleged manipulation of Libor, including last month three former employees at Rabobank.

Libor, or the London Interbank Offered Rate, is a global benchmark that is calculated daily, using estimates from banks of their own interbank rates. It underpins the terms of US$500 trillion of contracts from mortgages to the cost of corporate lending.

The Libor scandal erupted two years ago when Barclays was fined £290 million by British and US regulators for attempted manipulation of Libor and Euribor interbank rates between 2005 and 2009.

Royal Bank of Scotland, Swiss lender UBS, Rabobank and broker Icap have also received heavy fines over alleged rigging of Libor. Euribor is the eurozone equivalent.

The Libor system was found to be open to abuse, with some traders lying about borrowing costs to boost trading positions or make their bank seem more secure.

For Barclays, the latest development is a blow for the bank seeking to draw a line under the Libor affair after it triggered a management shake-up. The scandal sparked the resignations of three Barclays senior board members, including Bob Diamond, who was forced out as chief executive. — AFP.