UBS AG’s $1.5 billion settlement for manipulation of interest rates and criminal charges against two former traders paves the way for additional sanctions in a global investigation of more than a dozen banks and brokers.
Switzerland’s biggest bank settled with U.S., U.K. and Swiss regulators for manipulating rates thousands of times over six years through relationships with multiple banks and brokers. Two traders were charged with conspiracy in a criminal complaint, while UBS’s Japanese affiliate pleaded guilty in the U.S. to felony wire fraud. Hong Kong authorities today said they’ve started a probe into potential misconduct by the bank.
Regulators found that traders at the Zurich-based bank made more than 2,000 requests to its own rate submitters, traders at other banks and brokers to manipulate rate submissions through 2010. At least 45 bank employees, including some managers, knew of the “pervasive” practice and a further 70 people were included in open chats and messages where attempts to manipulate Libor and Euribor were discussed, the U.K. Financial Services Authority said.