City trader sues UBS for $400m after rate-rigging conviction quashed

A former trader who had his conviction quashed for "rigging" interest rates following a 10-year legal battle is suing his former employer UBS.

Tom Hayes launched a legal claim for malicious prosecution against the Swiss banking giant, claiming he was the bank's "hand-picked scapegoat" in one of the biggest scandals of the 2008 financial crisis.

In July, Mr Hayes had his conviction overturned by the UK Supreme Court after it was ruled unfair. He had been jailed in 2015 for manipulating interest rates used for loans between banks.

A complaint filed in a US court said the Mr Hayes was seeking $400m (£300m) in damages. UBS declined to comment on the case.

The filing said Mr Hayes was taking legal action in a bid to "deter and punish UBS for its role in intentionally directing the destruction of an innocent man's life for their own selfish reasons".

His lawyers claim the global banking giant misled US authorities with the aim of branding him the "evil mastermind" behind alleged Libor misconduct in an effort to protect its senior executives and minimise regulatory fines.

The complaint, filed in Connecticut, also claims UBS "gained control over the investigation into its own alleged misconduct" and conducted a "fundamentally flawed" investigation in order to pin the blame on Hayes.

It added that UBS "offered Hayes up on a silver platter" to be prosecuted in both the US and the UK, and that those prosecutions were "engineered by UBS's intentional false and misleading disclosures".