ARmy Rumour SErvice

I believe the FSA themselves (or perhaps the SEC) said Barclays would get an 'easier ride' because they were forthcoming and the issues were limited there. They also noted their submissions deviated less than other banks to the expected submission rates.

Given the largest part of their fine originted from US regulators I would suspect some of the less well rated, more leveraged US banks are in for big slap, e.g. MS and ML as BAML. I bet LEH was really manipulating their submissions too.

Another line being looked at now is if the Tax payer was ripped off in the bail out loans of 2008 by banks fixing LIBOR so the already cheap loans were even cheaper, now that could be good grounds for criminal charges.

Originally Posted by Wordsmith

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I can state the problem in a sentence: "The potential rewards from the financial sector were so high, they distorted individuals ethics and judgement; leading to them breaking the rules and taking extremely risky courses of action". In many ways the solution to the financial sectors' problems is to reduce the level of bonuses - thus reducing the incentive to break rules and take risks.
...

It's really not much different from the Golden Age Of Irish Banking just on a far grander scale. A culture based on speculative trading in asset bubbles has thrived in The City since the mid 80s, ethics free easy money, lots of back scratching and dodgy over rewarded actors subject to a great deal of political pandering that's mutually reenforced by an ever tighter grip on the economic well being of the nation, a truly vicious circle.

This storm in a tea cup will blow over without significant changes as there is no real political will to tackle the problem. Unfortunately the result of examining in public the crawling amoral mess under the stone would be immediate economic damage to an already weak UK PLC. The long post Big Bang beano will eventually end of course and far more messily than it did in Ireland.

I predict a great deal of lecturing from the grey men of Frankfurt about Swabian virtues. We could easily stumble from PIIGS to UKIPIGS.

Originally Posted by oldbaldy

I see the tort lawyers in the US are circling.

They landed last year. In fact the only surprising thing is that so may people claim to be surprised: this has been rumbling for a long time and lawsuits are now fluttering down like leaves in autumn.

For example:

In re: LIBOR-Based Financial Instruments Antitrust Litigation

Hausfeld LLP represents The Mayor and City Council of Baltimore and the City of New Britain Firefighters’ and Police Benefit Fund in a class action lawsuit alleging a global conspiracy by member banks of the British Bankers’ Association (“BBA”) to manipulate LIBOR (the London InterBank Offered Rate)

The defendants, which are the banks that served on the U.S. dollar LIBOR panel of the BBA during the alleged conspiracy and their corporate affiliates, are: Credit Suisse Group AG; Bank of America Corporation; Bank of America, N.A.; JP Morgan Chase & Co.; JP Morgan Chase Bank, N.A; HSBC Holdings plc; HSBC Bank plc; Barclays Bank plc; Lloyds Banking Group ;plc; WestLB AG; Westdeutsche Immobilienbank AG; UBS AG; The Royal Bank of Scotland Group plc; Deutsche Bank AG; Citibank NA; Citigroup Inc.; Coöperatieve Centrale Raiffeisen Boerenleenbank B.A.; The Norinchukin Bank; The Bank of Tokyo-Mitsubishi UFJ, Ltd.; HBOS plc; and Royal Bank of Canada.""

The direct impact on individuals is small. The indirect impact, via investments, pension funds etc, is huge.

LIBOR and Euribor are key factors in the way in which the cost/value of Derivatives are calculated. There are vast quantities around. Even a very small movement in the rate on huge volumes can produce joy or misery in terms of marking the value on a daily basis, hence all the pleading emails sent to the Barcap team doing the fixes (and that really is a well chosen term)

Note the words "Global Conspiracy" This is a huge scandal: every major UK bank with the exception of Standard Chartered is in the shite to a greater or lesser extent and many foreign ones

At the moment itis just civil fines but people are going to stand trial. Will it be the right people? Probabaly not, just some small or medium sized useful idiots/disposable cogs in the machine.

Now a Barclays whistleblower informed the UK Government about this more than FOUR YEARS ago.

Four years ago.....UK Government at the time....now let me think....

http://www.bloomberg.com/apps/news?p...d=aMSoLbYpbHWk

The manipulation of the LIBOR is being used as a political and journalistic football.
To the borrower or account holder the effects were negligible.
The advantage was that the banks could artificially boost confidence in themselves and prevent a collapse of the banking system which would have been enormously to our disadvantage.
Was it fraudulent? Yes, probably. Was it harmful? Probably quite the reverse.

I've just been speaking to an investment banking manager in Australia who says he'd hate to work in London just now because banking is being ridiculed and stifled out of existence. As he pointed out, the profits of those organisations are taxed and make a large contribution to the UK exchequer. Of course there are rogues in the financial industry but to tar all with the same brush is wrong and counter-productive.

The Aussies can, of course, have a little smirk, safe in the knowledge that they didn't fall for the toxic US property based scam perpetrated by US institutions into which UK banking walked.

Originally Posted by 25pdr

The manipulation of the LIBOR is being used as a political and journalistic football.
To the borrower or account holder the effects were negligible.
The advantage was that the banks could artificially boost confidence in themselves and prevent a collapse of the banking system which would have been enormously to our disadvantage.
Was it fraudulent? Yes, probably. Was it harmful? Probably quite the reverse.

Given that it started in 2005 I fail to see what banking system was being protected at that time?

Originally Posted by 25pdr

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The Aussies can, of course, have a little smirk, safe in the knowledge that they didn't fall for the toxic US property based scam perpetrated by US institutions into which UK banking walked.

The Strains may be sitting on a huge asset bubble of their own so smugness may not be in order. In FP Australia's bubbly conundrum.

Well according to the 2pm News, Daves Mates Rates is planning to do squat diddly about the LIBOR fiddling, reported as saying. Do something, me?, what do you take me for? If I stop this that's my nice city earner right up the shooting match, who going to keep me in Bolly if I have Tin shit (diamond) locked up? Ok so he didn't but he certainly gave off the vapours and if we get anything done it won't be under this Tory Spivs luving administration.