Compliance

RBS Expects To Be Snagged By LIBOR-Rigging Scandal

Tom Burroughes, Group Editor, London, 30 July 2012

articleimage

Royal Bank of Scotland, part-owned by the UK taxpayer,
expects to be punished for its role in the LIBOR-rigging affair that has
already seen rival Barclays hit with fines totalling £290 million (around $456
million), according to RBS chief executive Stephen Hester.

"RBS is one of the banks tied up in LIBOR. We'll have
our day in that particular spotlight as well," Hester told the Guardian
newspaper in an interview that was issued on its website yesterday.

Hester did not comment on the size of any possible fine but
said that the investigation by the Financial Services Authority, the UK
regulator, was "in process."

"Even though when all the LIBOR (fines) are out most of
it is going to be around the wrongdoings of a handful of people at a number of
banks, those wrongdoings taint a whole industry beyond the handful of people and
that makes it a huge problem,” Hester said.

In recent weeks, documents sent to regulators and in the US, and other
comments reported in the media, suggest that a number of banks are implicated
in manipulation of interbank interest rates going back several years.

Already, Barclays, the UK bank, has been rocked by the
scandal, paying fines to US and UK
authorities and seeing the resignation of high-profile CEO Bob Diamond. There
is the possibility that banks will be hit with criminal prosecutions and
class-action lawsuits from disgruntled investors.

Register for WealthBriefing today

Gain access to regular and exclusive research on the global wealth management sector along with the opportunity to attend industry events such as exclusive invites to Breakfast Briefings and Summits in the major wealth management centres and industry leading awards programmes