FT’s Alphaville provides some of the juicy detail on the UK’s FSA and US Dept of Justice report on Barclay’s almost 5 year “attempted manipulation of and false reporting of LIBOR and Euribor Benchmark rates”.
“From here it starts to get really juicy. Thank goodness for people who will put anything in an email, eh?
Barclays’ traders located at least in New York, London and Tokyo asked Barclays’ submitters to submit particular rates to benefit their derivatives trading positions, such as swaps or futures positions, which were priced on LIBOR and Euribor. Barclays’ traders made these unlawful requests routinely, and sometimes daily, from at least mid-2005 through at least the fall of 2007, and sporadically thereafter into 2009. The Order relates that, for example, one trader stated in an email to a submitter: “We have another big fixing tom[orrow] and with the market move I was hoping we could set [certain] Libors as high as possible.”
As “high” as possible? Gosh, there was even an internal push and pull about whether the rate should be lower (good for reputation) or higher (good for certain derivatives transactions)?”
It seems to that they Barclay’s were willing to change rates for external traders too, on request.
“Requests from external traders:
For example, on 26 October 2006, an external trader made a request for a lower three month US dollar LIBOR submission. The external trader stated in an email to Trader G at Barclays “If it comes in unchanged I’m a dead man”. Trader G responded that he would “have a chat”. Barclays’ submission on that day for three month US dollar LIBOR was half a basis point lower than the day before, rather than being unchanged. The external trader thanked Trader G for Barclays’ LIBOR submission later that day: “Dude. I owe you big time! Come over one day after work and I’m opening a bottle of Bollinger”.
It goes on and on…”
Latest posts by Donagh (see all)
- The policy of transferring incomes to capital and the rich - September 6, 2012
- ILR Will Not Blink While Facing Down the Jaws of Excessive CPU Usage - September 6, 2012
- Dan Froomkin | The Jobs Crisis Obama, Romney and the Low-Wage Future of America - August 29, 2012
- Money as a Social Construct – Talk Given by Mary Mellor - August 27, 2012
- - August 23, 2012