Suspected interest-rate manipulators, Tom Hayes, Terry Farr, and James Gilmour, have pleaded not-guilty in court. Hayes, a trader formerly of UBS AG and Citigroup Inc., Farr and James, formerly traders with R.P. Martin Holdings Ltd., have been charged for manipulating the London interbank offered rate, Libor, and other benchmark rates.

The not-guilty pleas present a new obstacle for prosecutors. Tom Hayes was expected to be cooperative with prosecutors and plead guilty. Prosecutors expected that Hayes played a central role in the manipulation scheme and would serve as a cooperating witness, according to the Wall Street Journal.

“LIBOR has wide reaching impact on the financial markets, our cities, hospitals and utilities,” commented Peter Mougey, a shareholder with the Levin, Papantonio law firm who directs the firm’s business torts and securities litigation department. “LIBOR is commonly used for derivatives, like credit default swaps, in bond issuances,” according to Mougey. “This is just another example of Wall Street placing its interests ahead of its clients in.” The only difference between UBS’ conduct and a common thief is the Armani suit, says Mougey.”  Mougey believes “It is about time there are criminal penalties.”

However, Hayes hired a new defense team this past summer and changed his position toward the prosecution.

Investigations continue into the Libor case and additional defendants could be charged.

Hayes is suspected to have conspired with up to 10 financial institutions in order to manipulate rates. Hayes also faces criminal charges from the U.S. Justice Department along with other individuals connected to UBS and ICAP PLC. Those additional defendants have not entered pleas to U.S. charges.

Joshua is a writer and researcher with Ring of Fire. You can follow him on Twitter @Joshual33.