LONDON/WASHINGTON: Britain’s Lloyds Banking Group has agreed to pay fines totalling $370m to US and British authorities investigating its part in a global interest rate rigging scandal and manipulating fees for a UK government lending scheme.
The settlement is the seventh joint penalty handed out by American and British regulators in connection with the attempted manipulation of the London interbank offered rate, or Libor, and other similar benchmarks used to price around $450 trillion of financial products worldwide. The misconduct related to Libor rates for sterling, the US dollar and Japanese yen.
The penalties for Lloyds comprise a $178m fine by Britain’s Financial Conduct Authority (FCA), $105m by the US Commodity Futures Trading Commission and a $86m fine by the US Department of Justice.
The FCA said there had been routine manipulation of sterling Libor submissions to benefit money market trading positions between September 2006 and June 2009. To avoid negative media comment and market perceptions of its financial strength, Bank of Scotland, which Lloyds later acquired, manipulated Libor submissions as a result of at least two management directives in September and October 2008.
It said that in September 2008, just after the collapse of Lehman Brothers sparked a global meltdown in markets, a manager instructed a trader to lower dollar Libor submissions.
REUTERS
