Compliance
UBS Expected To Pay $1 Billion Over LIBOR-Rigging
UBS is expected to pay about $1 billion to settle charges of rigging LIBOR interbank interest rates, becoming the second large bank after Barclays to become officially hit by the scandal.
UBS is expected to pay about $1 billion to settle charges of rigging LIBOR interbank interest rates, becoming the second large bank after Barclays to become officially hit by the scandal, Reuters reported, citing an unnamed source.
A penalty on this scale would compare to the $450 million fine slapped on Barclays by UK and US authorities earlier in the year for a similar offence. The scandal led to the resignation of high-profile Barclays chief executive Bob Diamond. Earlier this week, Barclays announced it had appointed Hector Sants, former CEO of the UK’s Financial Services Authority, to the newly created role of compliance chief.
The details in the Barclays settlement showed traders brazenly gaming the system, the expected size of the UBS settlement indicates that Barclays may prove to be far from the worst offender and that other settlements may also be larger than Barclays', the news service said.
Overall, more than a dozen banks have been caught in the international inquiry, it said.
The Zurich-listed bank declined to comment when contacted by WealthBriefing.
Reuters said the agencies expected to be involved in the settlement, including Britain's Financial Services Authority and the US Department of Justice and the Commodity Futures Trading Commission all declined to comment.
A large fine on the bank would be a surprise because UBS, since 2011, has cooperated with law-enforcement agencies in their probes, according to regulatory filings and court documents, the report added.
If a settlement on the scale suggested is imposed on the bank, this will be a further blow to an institution that only recently saw the jailing of a former “rogue trader” whose unauthorised trades caused $2.3 billion in losses. As in the Barclays case, the affair prompted the-then CEO, Oswald Grübel, to resign, and also led to structural changes at UBS’s banking operations.
