A former Barclays trader fired by the bank for sending inappropriate e-mails about Libor “has cooperated” with the federal criminal probe into the alleged rigging of international benchmark interest rates, according to the New York hedge fund that currently employs the trader.
The hedge fund, WCG Management, sent an e-mail to its investors informing them that the $3.4 billion fund is not under investigation in the Libor probe, but confirmed that portfolio manager Ryan Reich has drawn scrutiny from US prosecutors.
WCG said in the e-mail, a copy of which was read to Reuters by a person who received it, that the fund had talked to Reich’s attorney, and the lawyer said his client had “cooperated” with federal prosecutors.
The hedge fund added that Reich’s lawyer said the feds have not asked any questions about Reich’s work for WCG, where he has been a portfolio manager since July 2010.
A spokesman for the Department of Justice declined to comment.
Kenneth Ulbricht, the chief operating officer for WCG, did not respond to requests for comment on the hedge fund’s e-mail to investors. Reich’s lawyer, Ira Lee Sorkin, a partner in the white-collar defense group at Lowenstein Sandler, declined to comment on the hedge fund’s e-mail.
Reuters last week reported that Reich was drawing scrutiny from federal prosecutors in Washington, DC, after being fired from Barclays in March 2010 for allegedly sending inappropriate e-mails seeking information concerning the pricing of Libor, information that could have been used in his trading positions.
In its investor e-mail, WCG referenced the Reuters story.
Libor, the London interbank offered rate, is used to set rates on trillions of dollars of contracts for everything from home mortgages to credit cards.