U.S. Regulator Latest to Sue International Banks For LIBOR Fixing

By Joe Vladeck

The National Credit Union Administration (NCUA) is the latest regulatory body to pursue sanctions against some of the world's largest financial institutions for allegedly manipulating LIBOR, a.k.a. the London Interbank Offered Rate.  LIBOR is a commonly used benchmark interest rate used to price trillions of dollars of financial products, ranging from credit cards and mortgages sold to the public to complicated bespoke derivative securities sold from one financial institution to another.  

The NCUA is alleging that its member credit unions lost investment income as a result of the interest rate manipulations.  The lawsuit, National Credit Union Administration Board v. Credit Suisse Group AG, names some of the world's largest banks, including JPMorgan Chase & Co, Barclays Plc, Societe General SA, and the Royal Bank of Canada.  This suit is the latest action in a fusillade of litigation and regulatory actions taken against the banks, which has drawn mixed results thus far.  Over the summer, Barclays, UBS, and RBS settled with U.S. and European regulators, agreeing to pay fines exceeding $2.5 billion.  But a series of earlier lawsuits, many of which brought claims under U.S. racketeering statutes, were dismissed this past Spring.