The Royal Bank of Scotland will have to pay more than $600 million to U.S. and UK regulators for its role in rigging the LIBOR interest rate. RBS is one of several banks that rigged LIBOR in order to make huge profits, as regulators looked the other way.
The Commodity Futures Trading Commission today released transcripts of electronic conversations between RBS traders and their clients that reveal just how explicit they were about rigging the rate in order to boost their respective bottom lines. Here are some of the highlights:
Yen Trader 1: where would you like it[,] libor that is[,] same as yesterday is call
Yen Trader 4: haha, glad you clarified ! mixed feelings but mostly I'd like it all lower so the world starts to make a little more sense.
Senior Yen Trader: the whole HF [hedge fund] world will be kissing you instead of calling me if libor move lower
Yen Trader 1: ok, i will move the curve down[,] 1bp[,] maybe more[,] if I can
——————
Senior Yen Trader: its just amazing how libor fixing can make you that much money
[…]
Senior Yen Trader: its a cartel now in london[.] they smack all the 1yr irs ..and fix it very high or low
——————
Yen Manager: for choice we want lower libors…let the [Money Market] guys know pls
Yen Trader 2: sure i am setting today as [Yen Trader 1] and cash guy off [Primary Submitter]
Yen Manager: great set it nice and low
——————-
Swiss Franc Trader: can u put 6m swiss libor in low pls?
Primary Submitter: NO
Swiss Franc Trader: should have pushed the door harder
Primary Submitter: Whats it worth
Swiss Franc Trader: ive got some sushi rolls from yesterday?
[…]
Primary Submitter: ok low 6m , just for u
Swiss Franc Trader: wooooooohooooooo[,] 0.01%? thatd be awesome
Primary Submitter: 1.33
Swiss Franc Trader: perfect[.] u r a nice man
These emails are right in line with those uncovered at other banks that were rigging LIBOR. This rigging may have cost U.S. taxpayers billions of dollars, but by and large, U.S. media have ignored it.
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