Barclays Said to Be Investigated by Regulators in Libor Probe
Barclays Plc (BARC) is being investigated by regulators seeking to determine if it broke information- sharing rules when setting the London interbank offered rate, a person briefed on the probe said.
U.S. and U.K. regulators are examining if communications between Barclays’s traders and its treasury broke regulations that stop information being shared across the bank, said the person, who declined to be identified because the details of the investigation are private. The Financial Times reported the inquiry on its website yesterday.
Barclays, the U.K.’s third-biggest bank, is among banks including Citigroup Inc. (C) and UBS AG that have received subpoenas from U.S. regulators investigating whether some firms manipulated the Libor rate, two separate people familiar with the probe said yesterday. The U.S. Department of Justice, Securities and Exchange Commission and Commodity Futures Trading Commission are working together with the U.K.’s Financial Services Authority on the probe.
Spokesmen for London-based Barclays, the BBA and Financial Services Authority declined to comment when contacted by Bloomberg News. A Citigroup spokesman declined to comment.
Libor, a benchmark for more than $350 trillion of financial products worldwide, is set daily by the British Bankers’ Association based on data from banks reflecting how much it would cost them to borrow for various periods and in different currencies. During the financial crisis, banks routinely misstated borrowing costs to the BBA to avoid the perception they faced difficulty raising funds, Tim Bond, then head of asset allocation at Barclays Capital, said in a Bloomberg Television interview in May 2008.
The investigation emerged last week after UBS AG, Switzerland’s biggest bank, said it received subpoenas from U.S. and Japanese regulators. UBS said it is conducting an internal review and is cooperating with the investigations.
To contact the reporters on this story: Gavin Finch in London at gfinch@bloomberg.net; Ben Moshinsky in London at bmoshinsky@bloomberg.net
To contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.net
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