Saturday, Apr 18, 2015Saturday, Apr 18, 2015

US regulator sues HSBC, Citigroup and others over Libor manipulation

Published on Mar 15, 2014 2:57 AM

NEW YORK (AFP) - The US Federal Deposit Insurance Corporation sued HSBC, Citigroup, Deutsche Bank and 12 other global banking heavyweights on Friday for manipulation of the Libor benchmark interest rate.

The regulator said the manipulation caused “substantial losses” to 38 US banks which were shut down due to insolvency during and after the 2008 financial crisis.

The FDIC said the accused institutions cheated the closed banks in US dollar Libor-based swap and other agreements through the manipulation of the rate between 2007 and 2011.

Libor, or the London Interbank Offered Rate, is used as a reference for some US$350 trillion (S$442 trillion) worth of financial contracts worldwide, from corporate loans to financial swap contracts.

Enjoy 2 weeks of unlimited digital access to The Straits Times. Get your free access now!