(Reuters) - US prosecutors have secured a guilty plea from a second former Deutsche Bank AG trader for conspiring to manipulate Libor, court records show.
Timothy Parietti, a 50-year-old former managing director of Deutsche Bank’s New York money market derivatives trading desk, pleaded guilty on May 26 in Manhattan federal court to conspiring to commit wire fraud and bank fraud, records unsealed on Wednesday showed.
According to a transcript, Parietti admitted that from 2006 to 2008, he participated in a scheme with other bank employees to manipulate Libor so that trades he made on financial instruments linked to the benchmark might be more profitable.
“At the time, I knew that this practice was dishonest. I participated in this dishonest practice and I accept responsibility for my role,” Parietti said. “I’m sorry for my conduct.”
The plea, pursuant to a cooperation agreement, was followed on June 2 by the US Justice Department unveiling an indictment against two other former Deutsche Bank traders, Matthew Connolly of New Jersey and Gavin Campbell Black of London.
Both cases followed the earlier guilty plea in October of a former senior trader at Deutsche Bank, Michael Curtler of London. The bank agreed in April 2015 to pay US$2.5bn to resolve related US and UK probes.
Larry Krantz, Parietti’s lawyer, declined comment, as did a spokeswoman for Deutsche Bank. A Justice Department spokesman had no immediate comment.
US and European authorities have been probing whether banks attempted to manipulate Libor to benefit their own trading positions.
Those investigations have resulted in roughly US$9bn in sanctions worldwide against financial institutions, and 16 people being charged by the Justice Department.
According to charging papers, from 2005 to 2011 Parietti and others engaged in a scheme to manipulate Libor, which was tied to the profitability of derivative trades in which they had a financial interest.
In charging Connolly and Black, prosecutors said that at least eight other people, including Curtler, were involved in the scheme to submit false estimates for some Libor rates in order to manipulate it.
Connolly has pleaded not guilty. Black’s attorney has previously declined comment.
The case is US v. Parietti, US District Court, Southern District of New York, No. 16-cr-00373.
Reporting by Nate Raymond
