RBS Fined $612 Million for LIBOR Misconduct
The Royal Bank of Scotland announced it reached a settlement with the Financial Services Authority (FSA) in the UK, the U.S. Commodity Futures Trading Commission (CFTC) and the U.S. Department of Justice (DOJ), in relation to investigations into submissions, communications and procedures around the setting of LIBOR.
RBS has agreed to pay penalties of 87.5 million ($137 million), $325 million and $150 million to the FSA, CFTC and DOJ respectively, to resolve the investigations.
As part of the agreement with the DOJ, RBS has entered into a deferred prosecution agreement in relation to one count of wire fraud relating to Swiss Franc LIBOR and one count for an antitrust violation relating to Yen LIBOR. RBS Securities Japan Limited has also agreed to enter a plea of guilty to one count of wire fraud relating to Yen LIBOR.
RBS CEO Stephen Hester comments on Libor fine
The investigations uncovered wrongdoing on the part of 21 employees, predominantly in relation to the setting of the bank’s Yen (JPY) and Swiss Franc (CHF) LIBOR submissions.
RBS said the key findings from the investigations are as follows:
Philip Hampton, RBS chairman said, “I want to speak very clearly and on behalf of the 137,000 employees of RBS. We condemn the behavior of the individuals who sought to influence some LIBOR currency settings at our bank from 2006-10. There is no place at RBS for such behavior. We are also determined to correct the broad range of control and risk management failures that originated in RBS during the financial boom years. LIBOR manipulation is one example. This is a painstaking task undertaken carefully and diligently over five years. We know that we cannot detect and solve every problem as fast as we would like. But our commitment is absolute.”
To read the RBS news release, click here.