CFTC Said to Probe ICAP, Banks on Swap Prices

Agency is looking into possible price manipulation of benchmark interest-rate swaps.

The Commodity Futures Trading Commission has issued subpoenas to ICAP Plc brokers and as many as 15 Wall Street banks as part of an investigation into possible price manipulation of benchmark interest-rate swaps, according to people familiar with the matter.

The CFTC plans to interview about a dozen current and former brokers at ICAP’s Jersey City, New Jersey, office as well as dealers that contribute prices used to set the daily ISDAfix swap rates, said three of the people, who asked not to be named because the matter is private. The regulator is probing whether ICAP brokers are colluding with dealers who stand to profit from inaccurate quotes, including failing to update published market prices after trades occur, one of the people said.

Price Screens

The ISDAfix rate and intraday trading levels that ICAP displays on an electronic screen known as 19901 are used by corporate treasurers, asset managers and other market participants as a measure of wholesale funding costs.

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