Breaking The Bank: Obama Administration has now declared war on non-U.S. banks too

Jan. 29, 2013

Royal Bank of Scotland facing £500 mn Libor fine


Am I missing something here? How is the Obama regime forcing it's regulations on foreign banks? Whether the bank broke the law or not is beyond the scope of the authoritarian in Washington DC

People walk past the Royal Bank of Scotland building 
in London last January. The bank could face a £500 mn
fine from British and US authorities for its role in the
Libor rate-rigging affair, media reported on Tuesday.

Royal Bank of Scotland could face a £500-million ($786-million, 585-million-euro) fine from British and US authorities for its role in the Libor rate-rigging affair, media reported on Tuesday.

The Wall Street Journal, citing people briefed on negotiations, added that US authorities were pushing for a settlement of allegations that would result also in an RBS division pleading guilty to criminal charges.

The newspaper said that the deal could be completed within the next fortnight and added that RBS was resisting any guilty plea amid fears it would lose clients and spark costly litigation.

A spokesman for the state-rescued bank would not be drawn on the article, simply saying: "Discussions with various authorities in relation to Libor setting are ongoing.

"We continue to co-operate fully with their investigations," he added in a statement.

The Edinburgh-based lender is 82-percent owned by the British government after a vast bailout at the height of the global financial crisis.

Investors meanwhile took flight at Tuesday's development. In late morning deals, RBS shares sank 5.60 percent to 347.20 pence on London's FTSE 100 index of leading shares, which was 0.12 percent lower at 6,286.87 points.

The Libor affair erupted in June 2012 when Barclays bank was fined £290 million by British and US regulators for attempted manipulation of Libor and Euribor interbank rates between 2005 and 2009.

In December, Swiss banking giant UBS was slapped with fines totalling $1.5 billion after a major probe by Swiss, British and US regulators revealed evidence of massive misconduct.

The Libor rate is used as a benchmark for global financial contracts worth about $300 trillion, and revelations that it had been rigged have harmed the reputation of the City of London financial centre, though the misconduct is alleged to have occurred elsewhere as well.

The London Interbank Offered Rate, or Libor, is a flagship instrument used all over the world, affecting what banks, businesses and individuals pay to borrow money. Euribor is the eurozone equivalent.

source: afp