U.S. Seeks Criminal Charges in RBS Libor Settlement, WSJ Reports

U.S. authorities are seeking a guilty plea to criminal charges from Royal Bank of Scotland Group Plc as part of a 500 million-pound ($785 million) settlement of an interest rate rigging probe, the Wall Street Journal reported, citing people familiar with the matter.

RBS executives are resisting any guilty plea on concern it could increase the Edinburgh-based bank’s exposure to litigation and lead clients to cut off activity, the newspaper said. A final figure has yet to be agreed upon and the deal could be completed within the next two weeks, it said.

A $785 million fine would be the second largest levied by regulators in their investigation into allegations traders manipulated submissions used to set the London interbank offered rate. UBS AG, Switzerland’s biggest lender, was fined $1.5 billion in December for rate-rigging, exceeding the 290 million pounds Barclays Plc paid in June.

U.S. authorities have faced criticism for rarely pursuing criminal action against big banks, the newspaper said. A UBS Japan unit agreed to plead guilty in connection with the rate-rigging investigation last month.

“Discussions with various authorities in relation to Libor setting are ongoing,” Yuk Min Hui, a Hong Kong-based spokeswoman for RBS, said in an e-mail. “We continue to co-operate fully with their investigations.”

U.K. government-owned RBS, which started an internal probe into Libor rigging in 2010, dismissed four bankers and suspended at least another three, including Jezri Mohideen, the head of rates trading for Europe and the Asia-Pacific region, the most senior employee to be disciplined so far.

Top executives at other banks that are still under investigation for rate manipulation have held informal talks about potentially reaching a multibank resolution, the Journal reported, citing unidentified executives involved in the discussions. The talks are at an early stage, it said.

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