Three former Barclays employees have been found guilty of rigging the Libor interest rate between 2005 and 2007.
[...] The Libor rate is used by banks to set prices of financial products. It stands for the London inter-bank offered rate, and underpins trillions of pounds worth of loans and financial contracts for households and companies across the world.
The jury was unable to reach a verdict, after nearly two weeks of deliberation, in relation to two other defendants, Ryan Reich, 34, and Stelios Contogoulas, 44.
[...] In May, it was revealed that a sixth employee of Barclays, Peter Johnson, had pleaded guilty to conspiring to manipulate the rate.
[...] Last year, Tom Hayes became the first individual to be convicted in the Libor fixing scandal, initially sentenced to 14 years in prison although that was later reduced to 11.
But in January five city brokers were cleared of helping Hayes to manipulate the Libor rate.
Source: BBC
Barclays declined to comment.
Related Stories
Deutsche Bank has nominated its chairman for a second term after an internal probe cleared him of accusations that he was partly to blame for the bank's poor cooperation with authorities in a probe into rate-rigging, a source close to the bank said. Paul Achleitner was nominated at a meeting of the lender's supervisory board in late October, the source said on Sunday. Shareholders will vote on the extension of his term at the annual meeting next spring.
Several shareholders said on Friday that a renewal of Achleitner's contract was imperiled by Deutsche's poor earnings and faltering share price. "The bank needs stability and continuity," said the source about his nomination. Last year, Germany's largest lender agreed to settle a case over the alleged manipulation of interbank rates such as Libor for a record $2.5 billion with U.S. and British authorities, which had accused the bank of obstructing their investigation.
[...] A motion calling for an additional external investigation was voted down at the annual general meeting in May. Any evidence of wrongdoing would have made it an uphill battle for Achleitner to secure a second term as chairman. Deutsche is still investigating some former top executives, the paper said.
What was the Libor rate-rigging scandal?
The Libor scandal was a series of fraudulent actions connected to the Libor (London Interbank Offered Rate) and also the resulting investigation and reaction. The Libor is an average interest rate calculated through submissions of interest rates by major banks across the world. The scandal arose when it was discovered that banks were falsely inflating or deflating their rates so as to profit from trades, or to give the impression that they were more creditworthy than they were. Libor underpins approximately $350 trillion in derivatives. It is currently administered by NYSE Euronext, which took over running the Libor in January 2014.
Related: Three Convicted in Libor Rigging Trial
Deutsche Bank Nearing Multi-Billion Dollar Settlement with U.S. Dept. of Justice
(Score: 0) by Anonymous Coward on Thursday July 07 2016, @03:06AM
That apparently Britain has a more responsive judiciary.
For comparison:
In striking contrast with these past prosecutions, not a single high-level executive has been successfully prosecuted in connection with the recent financial crisis, and given the fact that most of the relevant criminal provisions are governed by a five-year statute of limitations, it appears likely that none will be.
http://www.nybooks.com/articles/2014/01/09/financial-crisis-why-no-executive-prosecutions/ [nybooks.com]
(Score: 4, Insightful) by takyon on Thursday July 07 2016, @03:12AM
With the prospect of huge rewards and a history of skirting prosecution, you'd almost have to fault our financial overlords when they don't commit white-collar crimes.
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 0) by Anonymous Coward on Thursday July 07 2016, @03:30AM
It's not even the lack of criminal proceedings, but the bailouts.
Warren made a point during congressional hearing that this was maybe the first time the principle parties didn't have to suffer any type of loses on their holding, but were in fact paid bonuses in several cases.
You can't run a financial market on all carrot and no stick.
And you had Paulson prior stating that it would operate in much the same fashion as the RTC.
But the RTC was, at the time, the costliest scandal in US history (also one of the most under-reported). Even that had some token prosecutions at least.
Even more surprising given the lack of guns in England, I would have anticipated some prosecutions lest big game hunting of investment bankers to become a new American past-time
(Score: 1, Informative) by Anonymous Coward on Thursday July 07 2016, @03:50AM
You can't run a financial market on all carrot and no stick.
Sure you can. The elites get all the carrots, and the masses get the stick when things go south. This is all by design to create boom and bust cycles. Elites can mobilize themselves and their money far easier than us peons can. So, they can shift into other markets while the currency we're forced to use to pay bills and taxes plummets. Once a recession sets in the elites can swoop in and buy up everything for next to nothing. Banks can hold the economy at depression levels until the populace agrees to accept their monetary policy and monopoly on currency printing.
If you revolt against the international banking cartel, they cause wars in your nation. [youtube.com] This has been going on for centuries, and it's worked out quite well for the elites.
(Score: 1) by kurenai.tsubasa on Thursday July 07 2016, @02:32PM
Still meaning to get around to watching that video. Saw it on youtube a while back, forgot about it, then was reminded when you started posting it all over the place. It's an intriguing theory.
Sort of going on a tangent (when has that stopped me!), but one of the most disgusting things that banks do is keep houses off the market. I say that as somebody who'd stand to lose out if the price of housing dropped to where it probably should be. The 2008… tremor (compared to what's probably going to happen)… must have been a big fat payday for banks. For all their histrionics, they must have had a field day gobbling up inventory from the real estate market. Here's an article from 2012 [thestreet.com] describing “shadow REO.”
It's almost the perfect scam. Lend out money you don't actually have (horray for fractional reserve banking!) so somebody can “buy” a home, collect payments for a while (along with PMI, which is another fantastic scam—get the borrower to pay for insurance that covers your ass, not theirs, when things go pear shaped), then when things do go pear shaped, foreclose on them and add yet another property to the shadow REO inventory.
The banks justify shadow REO by pretending that they're doing homeowners a favor. I mean, I suppose… ostensibly at least. If all the shadow REO out there hit the market tomorrow, I'd definitely cry, but we would all be better off that way.
I haven't looked into it, but I'm certain there are about 3 or 4 houses on my street that are shadow REO homes. It's a damned shame when there are people in the homeless shelter downtown. We have the wealth sitting right there in front of our faces, and it's untapped because of numbers in a computer somewhere. (Granted, I know I'm oversimplifying here.)
I can only imagine that the end game is to turn us all into renters. I said it then, and I'll say it again. I don't care about “too big to fail.” Just let it fail already. I want to see bankers in soup lines, even if I wind up right beside them when my meaningless job evaporates. I at least have skills and a willingness to learn if carpenters are needed after the revolution instead of programmers, so I won't be there long unlike those useless leaches. The soup line is a better and more karmatic, I suppose, punishment for bankers than any fine or jail time in a minimum security resort ever will be.
Then we can all realize that we've been fools and move on, a little wiser for the wear. Let it all burn down. Farmers will still grow food, and we have more than enough to go around if we can banish the bankers from our society and reformulate it based on wealth instead of debt. Debt-based currency is the new indentured servitude.
Didn't see a print link on the article so this is from page 2:
In fact, if lenders turn their REO release valve to full blast, the deluge of foreclosures cascading onto the market could plunge the country into a recession, said Thomas Martin, president of consumer advocacy group Americas Watchdog.
"If they let the dam essentially break. It could be a catastrophic disaster for the U.S. economy," he said, predicting that some major banks would fail and home prices would nosedive by 20 percent.
Actually, 20% wouldn't be too bad to bear, personally. Enlightened self interest.
(Score: 1) by khallow on Thursday July 07 2016, @10:47PM
It's almost the perfect scam. Lend out money you don't actually have (horray for fractional reserve banking!) so somebody can “buy” a home, collect payments for a while (along with PMI, which is another fantastic scam—get the borrower to pay for insurance that covers your ass, not theirs, when things go pear shaped), then when things do go pear shaped, foreclose on them and add yet another property to the shadow REO inventory.
You know what makes it a less than perfect scam? The huge amount of money the banks lost on REO. A house in "shadow REO" isn't making money for the bank and is slowly losing value due to repair and lack of use. What this really is is a way to hide costs for years. It'll probably turn up the next time there is a banking crisis.
(Score: 1, Informative) by Anonymous Coward on Thursday July 07 2016, @03:27AM
Are you sure the Libor ones were high executives and not just peon brokers?
The reported ages range 34 - 45, so if that is now, and the cheating was 2005 - 2007, they would be nine years younger at least then.
25 - 36 years old high executives?
(Score: 0) by Anonymous Coward on Thursday July 07 2016, @04:46AM
18 is old enough.
https://www.youtube.com/watch?v=7Z6TecVZAhk [youtube.com]
possibly 13...
https://www.gov.uk/child-employment/minimum-ages-children-can-work [www.gov.uk]
(Score: 1) by khallow on Thursday July 07 2016, @04:51AM
In striking contrast with these past prosecutions, not a single high-level executive has been successfully prosecuted in connection with the recent financial crisis
Once again, there has to be a crime first. Just because something bad happens doesn't mean it is a crime.
(Score: 1) by kurenai.tsubasa on Thursday July 07 2016, @02:45PM
The real crime is that those shenanigans aren't crimes on the books.
(Score: 2) by mendax on Thursday July 07 2016, @04:35AM
It's a shame that they can't be sentenced to be burned at the stake.
It's really quite a simple choice: Life, Death, or Los Angeles.
(Score: 0) by Anonymous Coward on Thursday July 07 2016, @06:37AM
(Score: 4, Interesting) by FatPhil on Thursday July 07 2016, @08:08AM
I think a fair punishment for all bankers guilty of financial crimes should simply be to push them out of their office window. The higher up they are in the organisation, the higher floor their office is on, and the longer time they will have to think about their wrong-doings before the final tarmac redemption. Bail them out? Push them out, more like.
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by GreatAuntAnesthesia on Thursday July 07 2016, @08:42AM
> I think a fair punishment for all bankers guilty of financial crimes should simply be to push them out of their office window.
Wouldn't work, they soon install safety nets. You need to make sure they are wearing a literal "golden parachute" before you push.
(Score: 2) by FatPhil on Thursday July 07 2016, @11:11AM
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by quintessence on Thursday July 07 2016, @12:30PM
All this savagery and vengeance.
I actually wanted something closer to restitution in matters like this.
In my minds eye, the banker would put up any amount he desired towards restitution. However, everyone else would put up as much as they liked towards a license to hunt (limited time offer) said banker.
Whoever put up the largest amount wins, with either the banker paying restitution to clear his name or the people putting up a bid to hunt. All proceeds go towards paying back the clients.
In the case of the hunt, rights to televise are further auctioned off to pay back debits. I picture something like Survivor, but you could also do sci-fi themes like Logan's Run and whatnot. Maybe even a Hunger Games tie-in for the younger crowd, and even have the home viewer able to sponsor extra bullets or bullet-proof vests depending on their favorites.
Anyhoo, I'm not a creative type, so best leave this aspect to the experts.
What of deterrence you say? That's the best part.
In some rare circumstances (too big a cock-up to salvage) where no amount of restitution would be able to make whole, or a special case of overwhelming demand, the banker would not even be notified that a license was sold. He could never be certain until all these defective cans started showing up in his life.
Win-win as far as I can see.
(Score: 2) by FatPhil on Friday July 08 2016, @06:09AM
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 0) by Anonymous Coward on Friday July 08 2016, @02:08PM
You've just reinvented the U.S. electoral system.
(Score: 0) by Anonymous Coward on Thursday July 07 2016, @01:17PM
the final tarmac redemption
I salute you! :D
(Score: 2) by mendax on Thursday July 07 2016, @07:02PM
Banks are inherently dishonest so it's there's no surprise there, and it's a shame that you left money in the British pound. Historically, the pound has an awful currency to hold long term, even though it's one of the major reserve currencies. During World War II it was worth about $5. By 1975 or so I think it was worth about $2.80. By 1986, my first adult visit to the UK, it was worth $1.60 and it has hovered in that general vicinity depending upon the strength or weakness of the dollar until recently when the Brexit nonsense started. Now that the Brexit has almost become a reality (assuming that the next PM actually invoked Article 50), the pound will continue to lose value against the dollar (and other currencies). It is a terrible pity.
However, once Ulster and Scotland have gone their separate ways, perhaps the United States can pick up a couple new states: England and Wales. After all, we kind of like the queen as we don't have one of our own, and we theoretically speak the same language, although we're going to have to do something about the odd spellings. ;-) Before you know it, Airstrip One will become a reality.
It's really quite a simple choice: Life, Death, or Los Angeles.
(Score: 2) by Thexalon on Thursday July 07 2016, @02:02PM
The thing is, burning at the stake is usually reserved for heretics. Since these are scapegoats, not heretics, the proper procedure is to beat and stone them and then exile them from the civilized world if they manage to survive the stoning and beating.
The only thing that stops a bad guy with a compiler is a good guy with a compiler.
(Score: 2, Insightful) by kurenai.tsubasa on Thursday July 07 2016, @02:54PM
How about making 'em run the gauntlet? Give every person they screwed over a club and line them up on either side. The more people they screwed over, the longer the gauntlet.