Ex-Deutsche Bank Trader Ordered to Face U.S. Libor Trial
(Bloomberg) -- A former Deutsche Bank AG trader must face Libor-rigging charges as a judge turned aside his claim that his compelled testimony to U.K. investigators fatally tainted the U.S. criminal case.
Gavin Black is scheduled to go on trial June 18 with Matthew Connolly, a former Deutsche Bank supervisor in New York. They’re charged with plotting to provide false Libor submissions to rig the benchmark rate underlying trillions of dollars of loans and other financial products.
U.S. District Judge Colleen McMahon in Manhattan didn’t publish her decision Wednesday, instead instructing prosecutors to "explain to the court how it intends to shield the trial team" from the document. She ordered it filed under seal.
Last year, a New York-based federal appeals court overturned the convictions of former Rabobank Groep traders Anthony Allen and Anthony Conti, saying their forced testimony before the U.K.’s Financial Conduct Authority tainted the U.S. case.
The ruling created problems for cross-border investigations involving the U.S. and U.K. The FCA has authority to force testimony in its investigations. In the U.S., the Fifth Amendment to the Constitution bars the government from compelling people to incriminate themselves. That means U.K. investigators can’t share forced testimony with their U.S. counterparts in some cases without endangering U.S. prosecutions.
At a July hearing in Manhattan, McMahon said the implications of the appeals court ruling were “huge” and that the Black and Connolly case was in “uncharted waters.” McMahon held hearing on the question last month that stretched into the night. Spectators were excluded from the proceeding for long stretches as lawyers and witnesses discussed Black’s testimony.
Seth Levine, Black’s lawyer, declined to comment on the ruling.
The case is U.S. v. Connolly, 16-cr-00370, U.S. District Court, Southern District of New York (Manhattan).
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