More Financial Corruption? Lloyds Bank Fined $218 MM in LIBOR Scandal

[Corey Dutton]

One of seven penalties imposed by the U.K.’s Financial Conduct Authority, Lloyds faces a $218 MM fine for misconduct and alleged manipulation of LIBOR. From a recent statement by Aitan Goelman of the CFTC, “Lloyds is being held accountable for serious misconduct,” by both U.S. and U.K. regulators.

Because mainstream media in the U.S. has largely ignored this scandal, many have scarcely heard of it. So what does this supposed, “misconduct,” mean for the financial markets as a whole? In the manipulation of benchmarks such as the interbank borrowing rate these banks were essentially messing with the cost of borrowing of upwards of $450 trillion in loans and derivatives worldwide. The LIBOR scandal, together with the fairly recent FOREX scandal, is a big wake up call to those that don’t believe in financial corruption, such as in the example of Lloyds Bank. As evidenced by the seven financial institutions that were fined in the LIBOR scandal, financial corruption is alive and well, despite increased oversight and fines by regulators.

Posted by Corey Curwick Dutton