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(Adds details of alleged Merchant, Bagguley friendship)
By Kirstin Ridley
LONDON, April 27 (Reuters) - Senior Barclays executive Michael Bagguley told a London court that he had neversought to influence Libor benchmark interest rates, instructedothers to do so, or seen any evidence of manipulation between2005 and 2007.
Former Barclays traders Stylianos Contogoulas, Jay Merchant,Alex Pabon and Ryan Reich and former Barclays rate submitterJonathan Mathew are standing trial after all pleading not guiltyto one charge of conspiracy to defraud by manipulating U.S.dollar Libor rates between June 2005 and September 2007.
In its third trial of individuals accused of rigging theLondon interbank offered rate, a benchmark for trillions offinancial contracts and household loans, Britain's Serious FraudOffice (SFO) alleges the five men were dishonest when they askedcolleagues to submit rates to benefit their trading positions.
Bagguley, who is chief operating officer of Barclays'investment bank and was called as a prosecution witness,dismissed a suggestion he was denying knowledge of the allegedactivity because he feared prosecution.
"I suggest you did know and are simply denying it," HughDavies, a lawyer representing Merchant, told Wednesday's courthearing.
Bagguley, a 15-year Barclays veteran, also denied asuggestion that he only realised attempts to influence Liborrates were wrong after the bank launched an internal inquiry andsettled regulatory allegations of wrongdoing in 2012.
"Given your understanding of Libor at the time, I suggestyou would not at the time have considered it improper," Daviessaid.
"I would have done," replied Bagguley.
Davies also alleged that Bagguley had distanced himself fromMerchant, described by Davies as a friend with whom Bagguley hadregularly socialised in London and New York. They went on tripsto Iceland, where they climbed volcanoes in 2002, Spain andFormula 1 motor racing events, Davies said.
Bagguley, who was Merchant's direct supervisor for a time,described him as a "work friend" and the Iceland trip as aweekend away for a group that worked on the same desk. He saidhe hadn't communicated with Merchant since 2012.
"You are distancing yourself from your friendship forobvious reasons," Davies said.
The prosecution told the court on April 7 that Merchant, theformer line manager of Pabon and Reich, alleged in SFOinterviews in March 2014 that his Barclays bosses, includingBagguley, had known of and approved the practice of seeking toinfluence the bank's Libor rates.
Davies said the jury had been presented with files ofevidence that showed various attempts by traders to influencerates openly, frequently and on corporate email accounts whileBagguley was a senior executive in New York.
But Bagguley said from the material he had seen duringsubsequent investigations that he was only aware of one suchexample, which involved Merchant.
Barclays declined to comment.
The trial is scheduled to last 12 weeks. (Editing by Alexander Smith)
