The Tom Hayes Case: A Deep Dive into the UBS Lawsuit
When Tom Hayes left his job as a Yen derivatives trader at UBS in 2009, his boss at the time had high praises for him, describing him as “very rational” and capable of solving any complicated task thrown his way. Little did anyone know that sixteen years later, this very observation would lead to a legal battle between Hayes and UBS that could potentially cost the Swiss bank $400 million or more.
Recently, Hayes’ lawyers filed a 300-page summons in the state of Connecticut, claiming that UBS owes him a substantial amount to cover the destruction of his career, loss of earning potential, emotional and physical harm, and more. Despite Hayes stating that it’s not about the money, the filing highlights the significant losses he has incurred since being embroiled in the LIBOR scandal in 2012.
Financial Losses
Hayes, who was once a top profit generator for UBS, had to sell his family home to fund his legal defense, which cost him over $1 million. His inability to work since being labeled as the “hand-picked scapegoat” for the scandal has deprived him of potential earnings that could have amounted to millions annually. The filing also mentions the $2.6 million retention bonus offered to Hayes by UBS in 2008, indicating the bank’s awareness of his profitability.
Personal Trauma
Hayes’ ordeal didn’t just end with financial setbacks. He claims to have developed multiple sclerosis due to the stress of prosecution and imprisonment, leading to his wife filing for divorce. His time in a high-security prison was marked by assaults and threats to his life, painting a grim picture of the toll the events took on his well-being.
Allegations Against UBS
Hayes alleges that UBS framed him as the “evil mastermind” behind the LIBOR rate rigging, portraying him as a vulnerable and visible target to deflect attention from the bank’s own potential penalties. He asserts that UBS benefited from sacrificing him as a scapegoat to negotiate lenient treatment with US prosecutors, safeguarding the bank’s operations and senior management.
Training and Impartiality
Hayes claims he received no formal training on LIBOR submissions at UBS and was directed by his superiors to influence the submissions to benefit the bank’s positions. Despite his actions being known to UBS managers and common in the industry, he was singled out and faced severe consequences. Hayes emphasizes that his requests often aimed to help other traders on the Yen Desk, showcasing his impartiality in the matter.
UBS has declined to comment on the ongoing legal proceedings, distancing itself from the initial criminal case between Hayes and the Serious Fraud Office.
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