Geithner Proposed Libor Changes in ’08

Treasury Secretary’s recommendations to the Bank of England included polling more U.S. banks.

Timothy F. Geithner in 2008 sent the Bank of England recommendations for improving calculations of the London interbank offered rate, now at the center of a scandal over allegations the benchmark was manipulated.

Geithner, the U.S. Treasury secretary who was president of the Federal Reserve Bank of New York at the time, sent Bank of England Governor Mervyn King six recommendations. One was to “establish and publish best practices for calculating and reporting rates, including procedures designed to prevent accidental or deliberate misreporting,” according to a memo obtained by Bloomberg News.

Market Monitoring

“In the context of our market monitoring following the onset of the financial crisis in late 2007, involving thousands of calls and e-mails with market participants over a period of many months, we received occasional anecdotal reports from Barclays of problems with Libor,” New York Fed spokeswoman Andrea Priest said this week in a statement.

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