The European Union Catches the Banks Holding Hands

By: Saturday December 14, 2013 2:38 pm

Early in the summer of 2012, Bob Diamond was an American banker with a talent for making numbers say what he wanted them to say. He was legit and was sitting in the catbird seat at Barclays Bank UK. He’d made $100 million over the previous six years.

A few weeks later, in early July, the world had flipped. Instead of sitting at his desk at Barclays Diamond was answering questions from a Parliamentary committee investigating LIBOR rate-fixing in 2008. A week after that he was out of work.

 

European Union Reaches Settlement in LIBOR Case

By: Friday December 6, 2013 10:16 am

The European Union has reached a settlement with bankers on what may be the most far-reaching fraud case yet. The manipulation of the London Interbank Offered Rate (LIBOR) shocked the financial world as the LIBOR rate is used for financial products all over the globe and in many different markets from car and home loans to complex derivatives. Rigging this key rate for profit meant numerous people and institutions received altered rates on their loans.

CFTC Chairman: LIBOR Still “Not Clean” Was Often “Completely Made Up”

By: Friday February 22, 2013 11:47 am

Gary Gensler, the head of the Commodities Future Trading Commission (CFTC), has made a pretty depressing admission to the BBC. During an interview on one of the greater financial scandals in modern times, the rigging of the London Interbank Offered Rate (LIBOR), Chairman Gensler submitted that the global benchmark for interest rates is still “not clean” and was often “completely made up.”

British Might End Too Big To Fail Banking

By: Monday February 4, 2013 7:38 am

After a global financial crisis, an epic price fixing scandal, and embarrassing criminal conduct British regulators are considering ending Too Big To Fail Banking. British Finance Minister George Osborne has proposed legislation that if banks do not shield their riskier investment activities from day to day banking they will face restructuring.

UBS Fined $1.5 Billion, Pleads Guilty to Fraud Charge in Libor Case

By: Wednesday December 19, 2012 2:40 pm

The Financial Times points out today that Tim Geithner, while heading the NY Fed, knew all about the Libor fraud at the major banks, and that traders were manipulating the rate purely to make money for themselves on various deals. This is a stronger charge than the idea that banks manipulated the rate for reasons of financial health, and Geithner knew it was happening. But he did nothing. As per usual.

First Libor Arrests Net Three Former Low-Level Traders

By: Wednesday December 12, 2012 12:05 pm

Maybe at some point, banks will face prosecution or at least fines in the Libor case. Everyone expects UBS, the Royal Bank of Scotland and several others to face some sort of sanction. But we’ve been hearing about imminent charges for months now, with nothing to show for it. Banks have individually terminated people they claim are responsible for the rate-rigging, but that internal discipline has been the only kind on offer.

Morgan Stanley Trader Investigated for Manipulation

By: Monday December 3, 2012 11:02 am

Maybe Glenn Hadden getting banned from trading will somehow create the long-absent deterrent for financial fraud. But actually putting him in jail would go a bit further.

Fed, Treasury Refuse to Take Libor Out of TARP Programs

By: Friday October 26, 2012 6:47 am

The Special Inspector General for TARP, Christy Romero, has recommended that the Federal Reserve and the Treasury Department stop using LIBOR, the benchmark interest rate derived in such a slipshod way that it was rigged for years. But the Fed and Treasury aren’t taking Romero up on the request.

British Regulators Announce Overhaul of Libor

By: Friday September 28, 2012 11:24 am

The Financial Services Authority, the top regulator of the banking industry in Britain, announced its changes to how the Libor, the benchmark interest rate which undergirds hundreds of trillions of dollars in financial products, will be derived. As expected, the British government will take responsibility for setting the Libor away from the British Bankers’ Association. They did not name a replacement for the BBA, but said they would appoint one sometime in the next year. Data providers like Bloomberg and Thomson Reuters have already shown interest in taking over.

More interesting, Martin Wheatley, the head of the FSA, said that he wants to make Libor rigging a criminal offense, to provide more of a deterrent.

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