From banker, to fugitive, to redemption

Libor rates underpinned trillions of dollars of loans, including credit cards. Keystone / Jenny Kane

A former Swiss financial trader describes his decade-long ordeal of hiding in Switzerland as a fugitive from US prosecutors as “Kafkaesque”. His troubles finally ended at the end of last month with all charges being dropped.

Ex-UBS banker Roger Darin was among a number of international traders accused of fraudulently manipulating Libor interest rates in 2012.

UBS was among a host of international banks heavily fined for manipulating Libor interest rates, which underpin trillions of dollars of loans including mortgages and credit cards.

Banks reported the London Interbank Offered Rate (Libor) on a daily basis to signal the cost of borrowing from other banks. In addition to influencing the cost of loans worldwide, Libor also plays a critical role in derivatives trading. The US, Britain and other countries accused some traders of manipulating Libor rates to fraudulently reap greater profits on these trades.

The most notorious prosecution for Libor manipulation involved former UBS trader Tom Hayes who spent five and a half years in jail after being found guilty of Libor manipulation by a British court.

Darin insists he never broke the law as a trader and has now seen criminal charges against him dropped. Roger Darin

The US Department of Justice had also been pursuing Hayes and Darin. But last week, a New York court threw out the US criminal charges against Hayes, forcing prosecutors to withdraw their indictment against both men.

‘Horror story’

“It was a Kafkaesque experience,” Darin told SWI swissinfo.ch as he described the last decade sheltering in his home country, which generally does not extradite its citizens.

Traveling abroad could have exposed him to the same fate as former UBS executive Raoul Weil, who was arrested in Italy in 2013 on a US warrant in an unrelated case.

“I didn’t know what would happen if I crossed Swiss borders. To have been arrested and spent time in a foreign jail would have been a horror story,” Darin said.

“I have relatives in Austria who passed away and I would have liked to have attended the funerals,” he added. “That wasn’t an option because you don’t know the risks you are taking on.”

The Libor system has since been reformed, and even replaced in Switzerland by a new method of determining inter-bank interest rates.

Darin has always insisted that he did nothing wrong and that the global criminal clampdown was politically driven. He refused to face his accusers in the US courts after first hearing about his indictment watching the news on television.

“I didn’t think I had the resources to defend myself. It would probably have cost me millions in legal fees to get a fair trial, standing up against a government which literally has unlimited resources,” he said.

And being a fugitive, the only way to put his case was to first meet the demands of a judge to turn himself in to the US authorities.

Washington trip

“My legal advice was not to travel to the US unless they offered immunity from prosecution. This wasn’t offered, so I didn’t go,” he said. “To this day I wonder whether things would have turned out differently had I gone. A number of people who did go, and who played very similar roles to me in the Libor story, weren’t indicted.”

An attempt to have his indictment dismissed by the US Supreme Court in 2016 was rejected.

After leaving the bank, his fugitive status then hampered his efforts to find a new job at another bank. “I was told by some banks that I couldn’t be employed for certain positions. That cost me opportunities.”

He has spent the last six years consulting banks and other financial companies on new forms of digital finance using blockchain.

Now that charges have been lifted, Darin is free to leave Switzerland without fear of arrest. His first travel destination will be Washington DC to celebrate with his lawyer, Bruce Baird, in the US.