5 people linked to UBS targeted in Libor probe: report

14th December 2012, Comments 0 comments

At least five people linked to Swiss banking giant UBS have been notified that they are under investigation by the British financial watchdog over the alleged rigging of the Libor benchmark rate, the Financial Times reported late Friday.

The Financial Services Authority's "targets include former and existing traders, rate-submitters and their supervisors," the FT said in its online edition, citing people familiar with the Libor probe.

UBS could not be reached by AFP for comment on Friday evening.

The FSA is one of four global authorities with which UBS will settle allegations that it manipulated Libor interest rates. The fine could be higher than $1 billion, people close to the situation told the FT.

UBS was the first bank to reveal problems in the rate-setting process of the Libor, otherwise known as the London Interbank Offered Rate, which sets the rate at which banks lend money to each other and also affects a vast range of contracts around the world.

In June, British bank Barclays was fined $452 million by British and US regulators for attempted manipulation of interbank rates between 2005 and 2009.

The Libor system was found to be open to abuse, with some traders lying about the rates to boost positions or make their groups seem more secure.

Barclays is the only bank to have been fined so far, but it is understood that about 20 banks globally are being investigated for possible Libor manipulation.

© 2012 AFP

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