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RBS blows whistle on Swiss franc bank cartel

OWoN: Never seems to end. In only will when we start to jail these Bastards for real.

RBS would have had a €115m fine - Image: Getty Images

RBS blows whistle on Swiss franc bank cartel

European Commission fines JPMorgan, UBS and Credit Suisse a combined £74m

The Telegraph
By James Titcomb
21 October 2014

European regulators have fined three banks a combined €94m (£74m) for operating in a price-fixing cartel that included Royal Bank of Scotland (RBS).

The taxpayer-backed British bank - along with JP Morgan, UBS and Credit Suisse - was found to have colluded to rig the price of interest rate hedging products, while RBS and JPMorgan also worked together to manipulate a Libor interest rate benchmark.

RBS however escaped a fine on both counts because it blew the whistle on the activity, which related to the Swiss franc. Had it not, RBS would have faced a financial penalty of €115m. "RBS was not fined as it benefited from immunity under the [European] Commission's 2006 Leniency Notice for revealing the existence of the cartel to the commission," the regulator said.

The four banks were found to have colluded to set interest rate derivatives, which are used by investors and businesses to hedge against rate changes, while RBS and JPMorgan were fined over the Swiss franc Libor benchmark, which carried a much bigger penalty.

The penalties, which relate to activity between 2007 and 2009, underline how banks’ past misconduct is continuing to drag on their bottom lines as they attempt to move on from the financial crisis.

JP Morgan was handed a €61.7m penalty for Libor fixing and €10.5m for derivatives manipulation, over which UBS and Credit Suisse were fined €12.7m and €9.2m respectively.

All banks, aside from Credit Suisse, received heavy discounts for co-operation.

“Cartels in the financial sector, whatever form they take, will not be tolerated,” said the EU’s competition chief Joaquin Almunia.

“Our economy needs a healthy, transparent, well-functioning financial sector.

"This is why antitrust rules in this sector must be strictly enforced.”

The fine is far smaller than previous EU fines for rigging interest rate benchmarks. At the end of the last year, it fined eight banks including RBS a combined €1.7bn for manipulating yen Libor and its euro equivalent, Euribor.

The UK regulator, the Financial Conduct Authority, has issued fines worth £530m related to Libor fixing while US regulators have handed down penalties worth almost $2bn (£1.2bn).


1 comment :

  1. This all sounds good, and all the banks have been fined virtually; but where does this money go to, and this is a one goes to jail. And the corruption just keep coming.

    There has to be a stopping point where the business model actually changes...


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