Emails Exposing Financial Scandals: Barclays' Libor Fixing, Fabrice Tourre, Philipp Hildebrand and Henry Blodget

Emails between banking staff at Barclays, one of Britain's biggest banks, have revealed dodgy, dishonest and downright dirty behaviour in yet another scandal where unthinking, often brazen, admissions of wrongdoing have been found in internal communications.

Barclays traders had been conspiring with those who report the interest rates, known as Libor (London Interbank Offered Rate) and Euribor (Euro Interbank Offered Rate), at which the bank borrows from other institutions to manipulate the figures in order to improve trading positions and make profit.

"The big day [has] arrived... My NYK are screaming at me about an unchanged 3month Libor," emailed one trader to a submitter in correspondence released by a Financial Services Authority (FSA) investigation, which underpinned its conclusion and resulting vast fine for Barclays.

"As always, any help wd be greatly appreciated. What do you think you'll go for 3m?"

The submitter replied: "I am going 90 altho 91 is what I should be posting."

"[...] when I retire and write a book about this business your name will be written in golden letters," responded the trader.

"I would prefer this [to] not be in any book!" his submitter retorted.

Fabrice Tourre and Goldman Sachs

Barclays staff aren't the only people to have been caught out by casual communication about their misdeeds. Other recent financial scandals have emerged from people pressing send without thinking.

In 2007, US regulator the Securities and Exchange Commission released the emails of Goldman Sachs trader Fabrice Tourre, who was accused of duping investors with complicated derivatives linked to the toxic sub-prime mortgages that triggered the financial crisis.

"...the entire system is about to crumble any moment...the only potential survivor the fabulous Fab...standing in the middle of all these complex, highly levered, exotic trades he created without necessarily understanding all the implications of those monstrosities!!!" he wrote candidly in one email from his Goldman Sachs email account.

Goldman has since settled for $550m (£354.6) with those making claims relating to the derivatives.

Tourre is still awaiting trial for his alleged part in the fraud.

In a separate Goldman Sachs email scandal, a former trader Greg Smith blew the whistle on managing directors referring to the investment bank's clients as "muppets", though Goldman claimed this was false.

Philipp Hildebrand

Philipp Hildebrand was forced to resign from his position as head of the Switzerland National Bank (SNB) after it emerged his wife Kashya had put half of the family's assets into dollars from Swiss francs, before the central bank weakened its currency.

Mrs Hildebrand then converted the €504,000 back into Swiss francs after the currency was devalued by the SNB, in order to buy a property. The two transactions led the Hildebrands to make a profit.

Mr Hildebrand denied all knowledge of his wife's currency dealings.

However emails later released showed the Hildebrands' private banker, Felix Scheuber, recalling a discussion about a dollar transaction.

"I also remember you saying in our yesterday's conversation that if Kashya wants to increase the USD exposure then it is fine with you," Scheuber wrote to Mr Hildebrand.

Mr Hildebrand then replied that he was "surprised" at the dollar reference because "we never discussed any dollar purchases yesterday".

While Mr Hildebrand was cleared of any wrongdoing, he said his position as head of the SNB was "untenable" and quit.

Henry Blodget

In 2002 Henry Blodget, a managing director and senior Merrill Lynch analyst, was exposed as putting out positive public research reports on internet companies that directly contracted his privately held views expressed by email.

For example, of the company Excite@Home (ATHM), Merrill published a rating suggesting investors buy and accumulate its shares.

"We do not see much more downside to the shares," said the research report.

"ATHM is such a piece of crap!" said a private email from Blodget.

Another firm, Lifeminders (LFMN), was given the same rating, with the research report claiming "LFMN presents an attractive investment".

Not so, said Blodget privately.

"I can't believe what a POS [piece of s**t] that thing is," he wrote in an email.

After an investigation by US regulators, Blodget was banned for life from the securities sector.

NatWest Three

British bankers Giles Darby, David Bermingham and Gary Mulgrew were charged, extradited and eventually pleaded guilty to defrauding their former employer, Greenwhich NatWest, a National Westminster Bank subsidiary, after hatching a complicated scheme in which a NatWest holding based in the Cayman Islands, Swap Sub, was sold back to energy trader Enron in an arrangement that led to the three bankers pocketing around $7m.

In a February 2000 email unearthed as evidence in by US authorities, Bermingham said to Darby and Mulgrew :

"This in an attempt to head the obvious off at the pass and keep the lid on the thing. Large numbers of people are asking what we are up to. I hate lies."

In an earlier message to Mulgrew, Bermingham says of then Enron CFO Andy Fastow:

"If I knew there was a realistic way to 'lock in' the $40 million and give him $25 million, we would also jump all over it I guess, since it would give us $15 million ... I will be the first to be delighted if he has found a way to lock it in and steal a large portion himself ... We should be able to appeal to his greed."