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United Kingdom

UK Supreme Court quashes Libor/Euribor convictions: jury misdirection, 'single cheapest rate' rejected, obiter on scope of conspiracy to defraud; implications for appeal system, SFO cases and FCA settlements

Published on: 12 August 2025

Published by a Law360 reporter
Legal News
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Article summary

The judgment (R v Hayes; R v Palombo [2025] UKSC 29) offers robust observations censuring the handling of the original trials and highlights worries about deficiencies within the criminal appeal system in England and Wales...

Background

Hayes and Palombo were found guilty in 2015 and 2019, respectively, of conspiracy to defraud arising from allegations concerning the manipulation of Libor and Euribor. Collectively, they received sentences totalling 15 years. Hayes remained on licence serving his 11-year term until the Supreme Court ruling set it aside. Seven further individuals continue to hold convictions for Libor and Euribor manipulation in the UK, which remains the sole jurisdiction where criminal findings for this behaviour still persist...

Calculation of Libor

Libor and Euribor functioned as benchmarks for short‑term interest rates, commonly referenced for commercial loan pricing and for determining values of numerous derivative instruments. Libor was derived from daily rate submissions by 16 contributor panel banks shortly before 11am. Each submitter was required to state the rate at which its bank could obtain borrowing. The bank’s assessment of the rate at which it could secure funds was submitted...

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