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London Self-Regulatory System Proves Illusory in Libor Scandal

As long ago as June 2008, New York Federal Reserve President Timothy F. Geithner was warning the Bank of England that letting bankers set the benchmark interest rate for global finance was open to abuse.

Governor Mervyn King’s failure then to take greater responsibility for Libor now poses a new threat to London’s drive to rival New York in the battle for a larger share of a shrinking international financial industry.