Sept. 2 (Bloomberg) -- The manipulation of currency and interest-rate benchmarks cause the public real losses, even though it can be hard to calculate the cost, British Attorney General Jeremy Wright said in his first public address since being appointed.
“Sometimes this is mistakenly perceived as victimless crime,” Wright said at the opening the Cambridge International Symposium on Economic Crime. “These scandals have undermined public confidence in the integrity” of public markets.
The British government has taken steps recently to stiffen punishments for benchmark manipulation. Last year, unlimited fines and jail sentences of as long as seven years were introduced for making false or misleading statements about interbank offered rates. In June, Chancellor of the Exchequer George Osborne proposed extending that to traders who rig gauges used in currency, fixed-income and commodity markets.
Authorities around the world have been investigating whether traders rigged the $5.3 trillion-a-day currency market after the U.K. markets regulator opened a review last year. Seven firms have settled U.S. and British authorities’ probes into manipulation of Libor, the benchmark interest rate for more than $300 trillion of securities worldwide ranging from student loans to mortgages.
Wright, who was named attorney general in July, also confirmed the government is considering extending anti-bribery legislation to allow companies to be prosecuted for failing to prevent economic crime, a change supported by Serious Fraud Office Director David Green and Emily Thornberry, the spokeswoman for legal matters for the U.K. opposition Labour Party, who also spoke in Cambridge today.
“We need to take fraud seriously,” Thornberry said in an interview. “If someone steals a wallet, they end up in jail, whereas if they steal your pension they don’t. We need to look at having more effective laws.”
The influence Britain’s biggest companies may have among politicians and the financial district make it essential for the SFO to be aggressive in investigating those same firms, Green said. The SFO is probing fraud allegations against large firms including jet-engine maker Rolls-Royce Holdings Plc and Barclays Plc, and began looking into currency rigging in July.
Deferred prosecution agreements were added to the SFO’s remit in February, though the agency hasn’t made its first offer. There are cases under way that may qualify for a DPA, Green said.
The SFO has been plagued by failures in recent years including claims by Vincent and Robert Tchenguiz, property tycoons who sued the agency for illegal searches. They secured 4.5 million pounds ($7.4 million), plus legal costs, in settlements in July.
The case is “the last of these debilitating issues,” Green said.
(An earlier version of the story was corrected to fix the Tchenguiz settlement date in the eighth paragraph.)
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