UBS Agrees to Pay $1.5 Billion to Settle Rate Rigging Charges

Posted on: December 19th, 2012 by ABC News No Comments

SEBASTIAN DERUNGS/AFP/Getty Images(WASHINGTON) — Federal prosecutors and regulators announced Wednesday a record $1.5 billion settlement with Swiss banking giant UBS for manipulation of interest rates.

Officials said UBS repeatedly manipulated Libor, the world’s benchmark for short term interest rates.

“The bank’s conduct was simply astonishing,” said U.S. Attorney General Eric Holder.

“UBS traders have been charged with conspiracy for their alleged roles in this scheme which allowed UBS to boost its trading profits by placing bets on the movement of benchmark interest rates and then manipulating those rates,” Holder said.

Assistant Attorney General Lanny Breuer called it “one of the most significant scandals ever to hit the global banking industry.”

The Libor rate is, regulators said, enormously significant since it is the basis for trillions of dollars worth of mortgages, student loans and other financial products.

Copyright 2012 ABC News Radio

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