US financial watchdog that supervises banking institutes has filed a legal complaint against some of the world’s largest banks. The FDIC has filed a ruling in the courts against 16 global players for rigging Libor rates.
The move comes on the back of investigations which saw American banks take the heat of market manipulation, with some going into recievership. Papers filed in the New York District court highlight 38 banks that have suffered on the back of interbank price rigging.
The Libor scandal has brought shame to global institutes with several bankers involved facing severe penalties.
ATFX Institutional Business Continues to Expand: Adding a New Prime BrokerGo to article >>
In the latest filing the FDIC named and shamed: Bank of America, Barclays, Citigroup, Credit Suisse, Deutsche Bank AG, HSBC Holdings, JPMorgan Chase, the Royal Bank of Scotland Group and UBS.
Libor is used by banks to assess rates at which lending is done between institutions overnight. US banks use Libor to benchmark loans and mortgages hence the FDIC’s concerns.
The latest dilemma hitting the FX markets is believed to be as serious, if not more than the the Libor scandal, the UK’s central bank governor spoke about the seriousness to MPs earlier in the week.