Tom Hayes became one of the most infamous names in the Square Mile after he was convicted to 14 years in prison for rigging the Libor interest rate in 2015. It took a decade for him to clear his name. Ali Lyon meets the former banker to hear about life in prison, and what comes next
Tom Hayes can still recall in striking detail the first night he spent in a prison cell.
It was a “baking hot” high summer’s evening in August 2015, and the former UBS trader had just received his ‘welcome pack’ that comprised a sorry assortment of tea bags, coffee, biscuits and UHT milk.
Earlier that day, Hayes had been handed the longest prison sentence of any white collar criminal in UK legal history, after he was found guilty of rigging Libor – a now-extinct interest rate set by banks to determine the cost of borrowing around the world.
After getting the news, the trader – whose career at the Swiss bank had taken him to Japan in 2006 – had quite understandably fallen into something of “an out of body experience”. But that trance ended when he sat down on his unforgiving mattress and looked out of his window at the contrail-punctuated pink sky above.
“HMP Wandsworth was under the flight path from Heathrow,” he says, recalling that life-altering day. “I just sat there, looking at the planes going over, and thought, ‘I used to sit on them, and watch over London as I went to and from Tokyo.’
“I never realised I was looking down on a prison, which I was later going to be inside.”
Hayes ultimately served five and a half years of his 14-year sentence, in an episode that saw him cast as the unlikely pin-up of banking excess in the aftermath of the global financial crisis.
But despite being released in January 2021, it was not until two weeks ago, when the Supreme Court overturned his conviction in a landmark ruling that grabbed attention far beyond the financial spheres with a natural interest in his case, that Hayes felt truly liberated.
Former traders Tom Hayes (centre right) and Carlo Palombo (centre left) outside the Supreme Court last month
Conviction overturned
“It was just such a relief,” he tells City AM, looking back on the ordeal which began over 16 years ago, when he was fired by Citibank after an investigation.
“For so long, I had no control over my situation. I was living my life on a 24-hour timeline. Even when I was out of prison, I was on probation unable to do certain things. I wasn’t free. Throughout that whole process – from the moment I was on bail to that verdict – I wasn’t free.”
After his conviction was quashed by a panel of justices led by Lord Reed, he did a flurry of media interviews before retreating to Cornwall’s north coast for a holiday with his 14-year-old son, who was just four years old when he was first convicted.
He has relished the “vast panoply of choice” that has opening up before him, freed from his everpresent probation officers, draconian restrictions on international – and even domestic – travel, all while constantly plotting the next rung of his fight to clear his name.
Perhaps unsurprisingly his acquittal has – much like his original sentencing – taken a while to sink in.
“It was a really unfamiliar experience,” he says. “I didn’t know how I felt because I was so used to losing.”
And there was certainly plenty of losing. Hayes only won two of the six trials and hearings he endured from ultimately stepping out of the Supreme Court a guilt-free man, back to 2009, when he was fired by Citibank after finding him guilty of manipulating Libor to suit his bank’s position while at UBS.
Three years after that dismissal, he was arrested by the UK authorities. Then, the Serious Fraud Office charged him with eight counts of conspiracy to defraud, of which he was convicted and sent to the high-security Belmarsh prison.
His first appeal was rejected out of hand, before four more tribunals and hearings came and went – both in and out of prison – over a decade which also saw him table an application to the Criminal Cases Review Commission (CCRC) in 2017.
That application was initially rejected in 2021 – after he’d finished time behind bars – plunging him to what he admits he was his emotional and physical nadir.
“I was in a very dark place then,” he says, his usually steely blue eyes noticeably sinking. “It was a particularly difficult blow for me, that. I just reminded myself of that Peter Mandelson line, ‘I’m a fighter not a quitter’.”
While he never fully gave up hope – “I spent all of prison thinking I was six months away from being released” – there were several times when even his assiduous, relentless team of lawyers were less optimistic.
But that changed when the CCRC offered up a chink of hope, recommending that the Court of Appeal relook at the case, eventually culminating in his acquittal at the Supreme Court.
Tom Hayes maintains his innocence
Throughout that relentless series tribulations he maintained his innocence. And while he readily concedes that he did set the rate to benefit his employer’s own commercial interests, he says doing so was a behaviour so widespread across investment banks, that it was inconceivable that one person – or a handful of people – could be held responsible. Indeed it was what people were encouraged to do, and – up until the financial crisis – in Hayes’ eyes, it worked.
“Libor was set up by banks, for banks, run by the British Bankers Association, the trade association for the banks,” he says. “Broadly, everything worked fine until people started lying about the rates because of solvency concerns [in the run up to the financial crash] that it all went wrong.”
After being dismissed by Citi, he went to a host of job interviews where he claims several people refused to believe the reason behind his dismissal.
But there were also warning signs. Ones that hint at him perhaps not being quite as streetwise as his colleagues in the under-regulated world in which banks reigned supreme before 2008.
“One of the interviews I had at Deutsche [Bank], the last thing he said to me was, ‘You weren’t careful enough,’” he says. “And I thought, ‘That’s strange, why would I ever be careful?’ It never dawned on me that I needed to be careful.”
The comment – which Hayes makes in a winding, impassioned answer recalling how pervasive his behaviour was that stretches over 1,000 words – is the only tacit acknowledgement, in an hour-long interview, that other people in his sector thought or behaved at all differently to him.
But even if he could have been less naive – less brazen, even – only the most cynical of observers would deny that on a human level he has endured a grim battle to clear his name. He spent the majority of his stint behind jail at Belmarsh, one Britain’s most notorious prisons.
And he was publicly lampooned by major City figures. George Osborne chastised the bankers involved in Libor manipulation as demonstrating “the worst of the values in our society”. meanwhile then Bank of England governor Mark Carney accused bankers of “theft”, while Hayes’ jury trial was under way.
Hayes walking to court with his now ex-wife, Sam Tighe, in 2015. (Photo by Peter Macdiarmid/Getty Images)
There is no doubt that given all this, Hayes’s story makes for a compelling yarn. With the dozens of setbacks, the ripe potential for a ‘David versus Goliath’ framing, and, above all, a gratifying ending, it contains all the raw ingredients for a Netflix documentary, or similar.
“I am going to write a book,” he says. “And I’m probably going to do some after-dinner speaking.”
There are also the other seven traders, whose convictions, while not as extreme as Hayes’s, he will now fight to help get overturned.
“I’m not a lawyer but I’ll be taking every opportunity to tell people that just because Tom Hayes is ok, everyone else is ok. That’s not the case,” he says.
Before any of that, though, the trader, fresh from his trip to St Ives, is planning another holiday. This time to Australia for what will be his first trip abroad since being put on Interpol’s red list and branded an international fugitive.
“I’ve booked my first flight to go abroad since 2012, he says. “The airlines asked my passport number and I panicked, thinking, ‘Do they always do that?’
“But it’s the Ashes in winter,” he says, taking a sip of tea in a West End restaurant which certainly doesn’t use UHT milk, and which boasts chairs immeasurably comfier than his bed in HMP Wandsworth. “And I just had to go to that.”