Danny McCance 26 Oct 2017 01:26pm

Deutsche Bank agrees $220m US settlement over Libor rigging

A US 45 state settlement for fraudulent conduct relating to the Libor rigging scandal has been announced

It was found that Deutsche Bank “materially misrepresented the integrity of the Libor benchmark” and made false or misleading submissions, New York attorney general Eric Schneiderman revealed yesterday.

While benefitting the banks position these manipulations, which were not a true representation of the banks borrowing rate, cost governmental and not-for-profit counterparties millions of US dollars after they entered into financial contracts with the bank.

“We will not tolerate fraudulent, manipulative or collusive conduct that interferes with or undermines confidence in our financial markets,” Schneiderman said.

“Large financial institutions, like all other market participants, have to abide by the rules.”

Between 2005 and 2010 a panel of 16 banks made daily USD Libor reports to reflect borrowing rates on the interbank market.

Between 2005 and 2013 Deutsche Bank was a panel contributor for all 10 Libor currencies, including USD Libor.

The investigation found that from as early as 2005 Deutsche Bank had acted unlawfully in their misrepresentation of LIBOR rates.

It was found that traders at the bank had deliberately influenced other panel banks to file misleading reports and failed to disclose its awareness of other banks manipulating Libor.

A settlement fund of $213,350,000 after investigation costs, will be distributed among those affected by Libor-related interactions with Deutsche Bank.

Deutsche bank is the second bank under investigation by the attorney General, after Barclays settled for $100m in August last year.