Traders Allegedly Monkeyed With Libor, Too

Arrests may be imminent in vast rigging scandal
By Kevin Spak,  Newser Staff
Posted Jul 24, 2012 8:30 AM CDT
Traders Allegedly Monkeyed With Libor, Too
One of the rings has been traced back to ex-UBS trader Thomas Hayes, who later allegedly brought the scheme to Citigroup.   (AP Photo/Keystone, Alessandro Della Bella, file)

Looks like Barclays wasn't the only one gaming the Libor system. Investigators are looking into an alleged conspiracy in which traders around the world worked together to rig Libor to boost their personal profits, the Wall Street Journal reports. Several different groups were allegedly working to rig the rate from 2005 to 2011, with the practice spreading as traders switched banks. One cabal alone involved six of the 16 banks that set the daily yen Libor rate.

Prosecutors in the US and Europe are close to arresting a number of traders over the scandal, sources tell Reuters—indeed, some of the suspects' lawyers have already been notified of impending arrests. The arrests could take pressure off the banks, making the rate-fixing look more like individual malfeasance than systematic corporate wrongdoing. Meanwhile, Bloomberg reports that regulators from Switzerland to South Korea to Japan are looking into the possibility that their rates might be vulnerable to foul play. (Read more Libor stories.)

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