LIBOR scandal spreads

UK Libor investigation grips 7 banks

Britain’s financial regulator has said that seven banks are under investigation over suspicion of manipulating interbank offered rates.

Press TV,

17 July, 2012

The manipulation of the London Interbank Offered Rate (Libor), a measure of how much banks charge each other for loans, has cost Barclays record fines of £290 million following an investigation by Britain’s Financial Services Authority (FSA).

Moreover, top executives, including Marcus Agius, the chairman of Barclays and Robert Diamond, Barclays Chief Executive Officer, resigned in the wake of the scandal at the second biggest UK bank.

Nevertheless, the FSA was criticized for not paying attention to warning signs and not reacting fast enough to reports of problems with Libor rates.

“This was under-regulated. You were warned about it and warned about it”, Labour MP George Mudie told FSA Chairman Adair Turner.

The FSA acting head of enforcement, Tracey McDermott, said the regulator is now investigating seven banks over suspicion of submitting false interest rates. However, she did not identify any of the lenders.

Furthermore, regulators in Europe, Asia, and the US are investigating Royal Bank of Scotland Group Plc, UBS AG, Lloyds Banking Group Plc, and Deutsche Bank AG among other banks.