Dutch bank fined $1.1B in Libor investigation29/10/2013 18:00
Source: USA Today
Investigation involves illegal rigging of benchmark used to set rates on trillions of dollars in mortgages, car loans, student loans and some financial derivatives.
The scandal over manipulation of an international financial benchmark widened Tuesday as authorities fined a Dutch global bank nearly $1.1 billion for rigging the closely-watched rate.
Rabobank became the fifth firm penalized for manipulating Libor — the London Interbank Offered Rate that's used to set the rates on trillions of dollars of mortgages, car loans, student loans and some complex financial derivatives. Libor rates cover multiple currencies worldwide for varying time periods. The bank also rigged rates for Euribor, a similar financial benchmark.
The rates are set each business day by the London-based representatives of global banks based on estimates of what they would expect to pay for short-term loans from each other in various monetary currencies.
Te U.S. Department of Justice and the Commodity Futures Trading Commission joined the United Kingdom's Financial Conduct Authority and the Dutch public prosecutor's office in imposing the costly settlement penalties against the Utrecht-based bank.