Oct. 18 (Bloomberg) -- Traders’ human rights may be violated by plans to punish Libor riggers and insider traders with tougher penalties including jail terms, some EU nations have warned.
Talks on the law have stalled over concerns that a combination of penalties from prison terms to fines and bans may clash with so-called double-jeopardy rules that prevent two sets of punishments for the same offense, according to a progress report published on the EU’s website.
The law “may give rise to tensions” with this rule, enshrined in the bloc’s Charter of Fundamental Rights, according to the document, which doesn’t identify the countries concerned.
Michel Barnier, the EU’s financial services chief, has urged swift adoption of the law to prevent any repeat of the scandal engulfing Libor and other interbank rates. The legislation would empower courts to hand jail terms to those found guilty of market abuse and insider dealing. It would also set out minimum administrative sanctions, such as fines, for offenders.
Confidence in Libor, the benchmark interest rate for more than $360 trillion of securities, was shaken following Barclays Plc’s admission in June that it submitted false rates. The revelations provoked renewed calls for tougher oversight of the financial system and pushed regulatory and criminal probes of Libor and other interbank lending rates, such as Euribor, to the top of the political agenda.
Cyprus, which holds the rotating presidency of the EU, is seeking guidance from EU finance ministers on how to continue work on the draft law, according to the document.
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