Banker guilty over lending rate fix

Friday 10 October 2014

A senior banker has become the first to be convicted in the UK over the rigging of the Libor interbank lending rate.

Neither the individual nor the bank can be named due to reporting restrictions. The banker's guilty plea to a charge of conspiracy to defraud was entered at Southwark Crown Court in London on Friday and can be reported now following a court ruling.

It follows a Serious Fraud Office (SFO) investigation into the alleged rigging of Libor. A number of others have been charged on separate allegations in relation to the practice.

The London Interbank Offered Rate (Libor) is used for hundreds of trillions of loans and transactions around the world, from complex derivatives to mortgages. It is a benchmark which indicates the interest rate that banks charge when lending to each other. In recent years banks have paid out billions in penalties to international regulators to settle allegations of Libor fixing.

In a statement, the SFO said: "This is the first criminal conviction arising from the Serious Fraud Office's Libor investigation. Eleven other individuals stand charged and await trial. The investigation into others continues."

Andrea Leadsom, economic secretary to the Treasury, said: "The integrity of the City matters to the economy of Britain. Ensuring that the key rates that underpin financial markets are robust, and that anyone who seeks to manipulate them is subject to the full force of the law is vital. That's why the Government is determined to deal with abuses, tackle the unacceptable behaviour of the few and ensure that markets are fair for the many who depend on them."