Meet Martin "The Hammer" Mallett, chief currencies dealer at the Bank of England in 2007, and, as WSJ reports, [6] recipient of emails that were part of an alleged campaign to rig benchmark interest rates, according to evidence presented in a London trial Wednesday. Remarkably, as we have detailed extensively [7], the emails were sent out with daily suggestions for where a variety of banks should set Libor. Mallett was later fired for what the central bank described as "serious misconduct," although the bank said his departure wasn’t directly related to the currencies-rigging investigation [8].
As The Wall Street Journal reports, [6] Martin Mallett, who at the time was the chief currencies dealer at the Bank of England, was among a couple dozen recipients of emails sent in 2007 by brokers allegedly working at the behest of former bank trader Tom Hayes. The recipients were blind carbon-copied on the messages...
In the emails, the brokers sent out daily suggestions for where a variety of banks should set the London interbank offered rate, or Libor. Mukul Chawla, the prosecutor trying Mr. Hayes, said those emails were used in an attempt to skew interest rates for the benefit of Mr. Hayes, at the time a trader in Tokyo at UBS AG.
Mr. Mallett, nicknamed “The Hammer,” was sent the emails at his hammer@bankofengland.co.uk [9] address.
Mr. Mallett left the Bank of England amid an investigation into attempted manipulation of foreign-exchange markets. He was fired for what the central bank described as “serious misconduct,” although the bank said his departure wasn’t directly related to the currencies-rigging investigation. Mr. Mallett, who couldn’t immediately be reached Wednesday, hasn’t previously commented.
A Bank of England spokesman had no immediate comment.
It is unclear why Mr. Mallett was receiving the emails. There is no indication that Mr. Mallett was involved in the alleged Libor manipulation by Mr. Hayes and his brokers.
Mr. Chawla said Wednesday that Mr. Hayes’s employer, UBS, arranged special payments—or “kickbacks”—to the brokers for their assistance.
UBS pleaded guilty to Libor manipulation in 2012.
Mr. Hayes pleaded not guilty to the criminal charges, but hasn’t had the chance to present his defense to the jury. He previously told The Wall Street Journal that “this goes much, much higher than me.”
News organizations covering Mr. Hayes’s trial aren’t currently allowed to report on the identities of the brokers or their employers.
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But just keep believing that markets are efficient and there's no rigging... so we leave you with one rather notable comment from the emails and chatrooms of this rigging scandal... [10]
"if you aint cheating, you aint trying.”
That seems to sum up our new normal perfectly.
