Libor Fixing Scandal: Credit Unions Take Aim at JPMorgan, UBS and Credit Suisse24/09/2013 22:33
A US credit union regulator has sued 13 banks including JPMorgan over alleged manipulation of Libor.
The National Credit Union Administration brought the lawsuit against JPMorgan Chase & Co, Credit Suisse Group, UBS and 10 other international banks on behalf of five failed credit unions.
The complaint, filed in a US District Court in Kansas, said the credit unions held tens of billions in investments and other assets that paid interest streams pegged to Libor.
"The credit unions received less in interest income than they were otherwise entitled to receive," the lawsuit claimed.
Over a dozen banks and brokerage firms have been investigated worldwide over alleged manipulation of Libor valuations, which directly influence the value of trillions of dollars of financial deals between banks and other institutions.
The benchmark reference rates are used in euro, US dollar and British sterling over-the-counter (OTC) interest rate derivatives contracts and exchange traded interest rate contracts.
The case follows the news that UBS's investment banking unit in Japan will have to pay a $100m (£62.5m, £74.1m) criminal penalty after pleading guilty to committing wire fraud in connection to the Libor fixing scandal.
The penalty was approved by US District Judge Robert Chatigny in Hartford, Connecticut.
In December, UBS agreed a record $1.5bn fine with US, UK and Swiss authorities for its role in manipulating a number of key benchmark interbank lending rates.
The UBS Japanese unit also pleaded guilty to US criminal charges by admitting to one count of wire fraud relating to rigging rates in Yen.
Prosecutors accused UBS Securities Japan of colluding to rig Libor yen rates from November 2006 to August 2009.
JPMorgan Chase & Co, Credit Suisse Group and UBS have not replied to a request for comment at the time of publication.