Another day, another confirmation of not only manipulation by the largest TBTFs in the largest market in the world, this time focusing in Europe, but pervasive collusion. Moments ago EU regulators fined 8 banks €1.71 billion for colluding in an attempt to manipulate key benchmark rates, which is also the EU's largest ever penalty in a cartel case. The banks participating in the settlement include some of the world's biggest banks such as Deutsche Bank, Société Générale SA, Royal Bank of Scotland Group PLC and J.P. Morgan Chase JPM. According to WSJ calculation [9], this latest action brings to roughly €6 billion the total penalties levied by regulators against financial institutions in connection with probes into manipulation of the London interbank offered rate, or Libor, and other widely used financial benchmarks.
Some obligatory soundbites from Joaquin Almunia, Europe's competition commissioner, who is shocked, shocked there was cartel collusion going on here:
The EU "is determined to purse all those who may have been involved in the cartel," Mr. Almunia said. He said that if the institutions are proven guilty, they will eventually receive "adequate sanctions." "What is shocking about the Libor and Euribor scandals is not only the manipulation of benchmarks, which is being tackled by financial regulators world-wide, but also the collusion between banks who are supposed to be competing with each other," Mr. Almunia said.
Actually, what is shocking is that even with everything else being manipulated, nobody seems to ever touch gold...
The summary of the fined banks, as well as the squealers, pardon, whistleblowers UBS and Barclays:
- Deutsche Bank gets biggest combined penalty of €725.4mln.
- SocGen fined €445.9mln for Euribor manipulation.
- RBS agrees to pay €391mln in cartels
- JPMorgan fined €79.9mln in JPY LIBOR case.
- R.P. Martin Holdings Ltd fined €247,000
- UBS and Barclays escape fines as EU whistle-blowers.
Finally, while we have shown this previously [10], below once again is a summary of how Wall Street manipulates, well, everything.
Foreign Exchanges
Regulators are looking into whether currency traders have conspired through instant messages to manipulate foreign exchange rates. The currency rates are used to calculate the value of stock and bond indexes.
[11]
Energy Trading
Banks have been accused of manipulating energy markets in California and other states.
Libor
Since early 2008 banks have been caught up in investigations and litigation over alleged manipulations of Libor.
[12]
Mortgages
Banks have been accused of improper foreclosure practices, selling bonds backed by shoddy mortgages, and misleading investors about the quality of the loans.
[13]