SFO Completes Review of LIBOR Convictions After Supreme Court Ruling, Declines to Seek Retrials for Hayes and Palombo
The Serious Fraud Office (SFO) has completed its review of all convictions that could be affected by the Supreme Court's ruling in R v Hayes and R v Palombo, the landmark LIBOR (London Inter-bank Offered Rate) and EURIBOR (Euro Inter-bank Offered Rate) manipulation cases. The Supreme Court found that the jury directions given at both trials were legally incorrect, rendering the convictions of Tom Hayes and Carlo Palombo unsafe. The SFO confirmed in early October that it will not seek a retrial, citing factors including that both defendants have already served prison sentences. The review extended to five further defendants, Jonathan Mathew, Jay Merchant, Alex Pabon, Philippe Moryoussef, and Colin Bermingham, whose jury directions may also have been affected. On 7 October 2026, the Court of Appeal overturned all five convictions after the SFO did not oppose their appeals. Peter Johnson's guilty-plea conviction has been assessed as safe. Christian Bittar, who also pleaded guilty, is separately pursuing his own appeal against his conviction, which the SFO is contesting; a hearing is expected this week. The LIBOR and EURIBOR rates affected the value of hundreds of trillions of dollars' worth of financial products globally, touching ordinary pensions, mortgages and savings. The SFO's original investigation produced nine convictions of senior bankers, with seven found guilty by juries and two via guilty pleas. The original cases spanned more than a decade of investigation and prosecution, making the Supreme Court's ruling one of the most significant reappraisals of UK financial crime prosecutions in recent memory.
Why this matters
The SFO's decision to close out the review without pursuing retrials draws a line under more than a decade of LIBOR prosecutions that were once held up as a template for tackling complex financial crime. The Supreme Court's finding that the jury directions were legally flawed does not mean the underlying conduct was lawful, but it does mean convictions obtained on those directions cannot stand. The practical consequence is that five individuals, Jonathan Mathew, Jay Merchant, Alex Pabon, Philippe Moryoussef and Colin Bermingham, have already had their convictions quashed by the Court of Appeal, which did not oppose their appeals following the Supreme Court's ruling. For regulators and prosecutors, the episode raises lasting questions about how juries in complex financial fraud trials are directed on the element of dishonesty, and whether the existing legal framework adequately captures benchmark-manipulation conduct at large financial institutions.
On the Ground
This story activates financial crime defence and regulatory litigation practices, and generates demand for advice on the interplay between criminal conviction standards and civil regulatory enforcement in market manipulation cases. Firms with white-collar crime and financial regulation capabilities are best placed to advise institutions and individuals monitoring the fallout. A trainee on a related matter would prepare detailed case chronologies, assist with Criminal Cases Review Commission referral documentation, index trial bundle materials for any ongoing appellate proceedings, and research the applicable test for unsafe convictions.
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“How does the Supreme Court's ruling in Hayes affect the SFO's ability to prosecute complex financial crime cases going forward, and what does it mean that the Court of Appeal has now quashed the convictions of the five other defendants affected by the ruling?”
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