“This dwarfs by orders of magnitude any financial scam in the history of markets.” – Andrew Lo
“LIBOR is huge. This is about as big as it gets in the financial world.” – Eliot Spitzer
Libor – “London Inter Bank Offered Rate. The rate at which banks in London lend money to each other for the short-term in a particular currency.”
At least $350 trillion in derivatives and other financial products are tied to the Libor.
In 2012, around 45 percent of prime adjustable rate mortgages and more than 80 percent of subprime mortgages were indexed to the Libor.
American municipalities borrowed around 75 percent of their money through financial products that were linked to the Libor.
On 27 June 2012, Barclays Bank was fined $200m by the Commodity Futures Trading Commission.
Banks involved in USD Libor determination:
– Bank of America
– Bank of Tokyo-Mitsubishi UFJ Ltd
– Barclays Bank plc
– BNP Paribas
– Citibank NA
– Credit Agricole CIB
– Credit Suisse
– Deutsche Bank AG
– HSBC
– JP Morgan Chase
– Lloyds Banking Group
– Rabobank
– Royal Bank of Canada
– Société Générale
– Sumitomo Mitsui Banking Corporation
– The Norinchukin Bank
– The Royal Bank of Scotland Group
– UBS AG
So far, only Barclays has admitted to manipulating the Libor.
Links:
Libor scandel
Libor
Daily Libor rate
Articles:
What Is Libor – London Interbank Offered Rate History & Scandal
Explaining the Libor interest rate mess
The rotten heart of finance
The Libor scandal and you
Timeline: Barclays’ widening Libor-fixing scandal
Libor scandal explained and what rate-rigging means to you
Libor rate-rigging scandal intensifies pressure on Wall St.
Ben Bernanke and Mervyn King describe Libor fixing as ‘fraud’
A crisis worse than 2008?
U.S. criminal probe in Libor scandal: report
Graphics:
Libor Scandal Explained
Behind the Libor Scandal
Videos:
It’s over for the banking cabal
