Ramanisblog

Tag: London Interbank Offered Rate

  • Who Runs The World,Banks Caught in Frauds?

    Of these banks which fix Price of  Gold listed below,HSBC was caught laundering drug money and despite Public Show of anger by the US it is being let off.

     

    Goldman Sachs was bailed out, the Executives had Bonus paid out to them even after bail out and stinging comment of President Obama was met by severe criticism by The Finance Industry!

     

    Societe Genearale
    Societe Genearale

    Deutsche Bank AG (DBK), JPMorgan Chase & Co. (JPM), UBS AG (UBSN) and Depfa Bank Plc were convicted by a Milan judge for their role in overseeing fraud by their bankers in the sale of derivatives to the city of Milan.(Bloomberg .com)

     

    “Barclays boss Bob Diamond has been shamed into giving up his bonus after his bank was fined £290million for trying to rig money markets.

    The massive fine was imposed by the UK Financial Services Authority and US watchdogs after Barclays was found to be deliberately manipulating the rate at which banks lend to each other.

    The bank knowingly fed false information into the system used to calculate the Libor rate for British banks and Euribor rate for European banks so its traders could make profits by speculating on rates.(The mirror UK)

     

    Continuing on the trail of exposing what is rapidly becoming one of the largest frauds in commodity markets history is the most recent interview by Eric King with GATA’s Adrian Douglas, Harvey Orgen (who recently testified before the CFTC hearing) and his son, Lenny, in which the two discuss their visit to the only bullion bank vault in Canada, that of ScotiaMocatta, located at 40 King Street West in Toronto, and find the vault is practically empty!

    http://www.zerohedge.com/article/latest-gold-fraud-bombshell-canadas-only-bullion-bank-gold-vault-practically-empty

    The multi-million pound loss occurred within weeks of the investment bank uncovering the much larger multi-billion fraud by rogue trader Jerome Kerviel. On top of the €4bn hit Mr Kerviel’s actions caused, the bank suffered a dramatic blow to its reputation.

    Although smaller, the Sfr182m hole uncovered in 2007 led to lawsuits and the liquidation of the Swiss subsidiary in which it took place. SocGen did not refer to the problems in any of its annual reports published at the time.

    The alleged fraud took place in December 2007. It happened at Rosbank Switzerland, the Swiss branch of SocGen’s Russian subsidiary Rosbank.

    The loss is detailed in Rosbank’s 2007 annual report in which it is described as a “fraud”. In its 2008 update Rosbank gave more details including how the situation had been remedied – through the injection of Sfr174.7m of shareholder fund.(telegraph UK).

    Members who fix Gold Prices.

     

    • Scotia-Mocatta — successor to Mocatta & Goldsmid and part of Bank of Nova Scotia
    • Barclays Capital — Replaced N M Rothschild & Sons when they abdicated
    • Deutsche Bank — Owner of Sharps Pixley, itself the merger of Sharps Wilkinswith Pixley & Abell
    • HSBC — Owner of Samuel Montagu & Co.
    • Société Générale — Replaced Johnson Matthey and CSFB as fifth seat.
    • These are the banks that Fix Gold Prices?

    You expect them be honest?

    The purport of this post(second part) has something else to bring out altogether

    As the post is getting too long I will conclude in the next post and explain who really runs the World and Economy, definitely not the Governments!

    Related;

    There are a couple of things which defy Logic and common sense.

    For instance,

    The ever Increasing price of Gold.

    The Price of Petroleum Products.

    Gold;

    http://ramanisblog.in/2013/02/10/who-controls-the-worldeconomy-gold-petroleum/

  • Linked Connecticut Shooting Libor Banks Rate Fixing Hearing?

    Connecting Shooting which killed children among others is now rumored to be linked to the Libor Scandal by The Banks.

    There is a hearing in the US Senate and the father of the killer of the innocent is reportedly linked to the Libor Scandal and the Testimony.

    Robert Holmes ,father of  the killer James Holmes, is a high level executive of the Financial Rating Company Figo

     The Father of another killer is an executive of a Bank.’GE Financial‘

    There are the other theories such as Drug Addiction and broken homes.

    Most importantly Gun Control issue in the United States.

    Either the Libor scandal  or the Anti Gun Control Lobby might have been the main reason.

    Truth is yet to emerge.

    If it is proved that Libor is the root cause, rest assured that nothing may come out of the investigation

    Financial Institutions, of late  are found to have been indulging in skullduggery, from manipulation of markets to laundering Drug money.

    One remembers Goldman Sachs and HSBC, the latter has been filed heavily for laundering drug money and curiously no executive was arrested(please read my blogs on Goldman Sachs and HSBC money laundering, its escape, filed under Banks.

    At times like these I am tempted to believe the presence of a killer Cartel that is manipulating the World Governments(my blogs on this subject will give  some inputs)

    What is The Libor Scandal?

    Bank of America.
    Bank Of America

    ‘The Libor scandal is a series of fraudulent actions connected to the Libor (London Interbank Offered Rate) and the resulting investigation and reaction. The Libor is an average interest rate calculated through submissions of interest rates by major banks in London. The scandal arose when it was discovered that banks were falsely inflating or deflating their rates so as to profit from trades, or to give the impression that they were more creditworthy than they were.[3] Libor underpins approximately $350 trillion in derivatives. It is controlled by the British Bankers’ Association (BBA).[4]..

    The Wall Street Journal reported in March 2011 that regulators were focusing on Bank of America Corp., Citigroup Inc. and UBS AG in their probe of Libor rate manipulation.[33] A year later, it was reported in February 2012 that the U.S. Department of Justice was conducting a criminal investigation into Libor abuse.[34] Among the abuses being investigated were the possibility that traders were in direct communication with bankers before the rates were set, thus allowing them an unprecedented amount of insider knowledge into global instruments.[35] In court documents, a trader from the Royal Bank of Scotland claimed that it was common practice among senior employees at his bank to make requests to the bank’s rate setters as to the appropriate Libor rate, and that the bank also made on occasions rate requests for some hedge funds.[36] One trader’s messages from Barclays Bank indicated that for each basis point (0.01%) that Libor was moved, those involved could net “about a couple of million dollars”.[35

    On 27 June 2012, Barclays Bank was fined $200 million by the Commodity Futures Trading Commission,[5] $160 million by the United States Department of Justice[6] and £59.5 million by the Financial Services Authority[7] for attempted manipulation of the Libor and Euribor rates.[38] The United States Department of Justice and Barclays officially agreed that “the manipulation of the submissions affected the fixed rates on some occasions”.[39][40][41]

    Barclays manipulated rates for at least two reasons. Routinely, from at least as early as 2005, traders sought particular rate submissions to benefit their financial positions. Later, during the 2007–2012 global financial crisis, they artificially lowered rate submissions to make their bank seem healthy.[6]…..

    By 4 July 2012 the breadth of the scandal was evident and became the topic of analysis on news and financial programs that attempted to explain the importance of the scandal.[47] Two days later, it was announced that the U.K. Serious Fraud Office had also opened a criminal investigation into manipulation of interest rates. The investigation was not limited to Barclays.[48][49] It has been reported since then that regulators in at least seven countries are investigating the rigging of the Libor and other interest rates.[50] Around 20 major banks have been named in investigations and court cases.[51]…

    Early estimates are that the rate manipulation scandal cost U.S. states, counties, and local governments at least $6 billion in fraudulent interest payments, above $4 billion that state and local governments have already had to spend to unwind their positions exposed to rate manipulation.[52] An increasingly smaller set of banks are participating in setting the LIBOR, calling into question its future as a benchmark standard, but without any viable alternative to replace it.[53]9Wiki)

    List of Banks involved in the Libor Scandal.

    The American banks included in the panel surveyed by the BBA for U.S. dollar fixing are:

    • The Bank of America
    • JP Morgan Chase
    • Citibank, NA

    There are 16 non-U.S. banks surveyed for U.S. dollar fixing in London. These banks are:

    • Bank of Nova Scotia
    • Bank of Tokyo-Mitsubishi UFJ Ltd
    • Barclays Bank plc
    • BNP Paribas
    • Credit Agricole CIB
    • Credit Suisse
    • Deutsche Bank AG
    • HSBC
    • Lloyds TSB Bank plc
    • Rabobank
    • Royal Bank of Canada
    • Société Générale
    • Sumitomo Mitsui Banking Corporation
    • The Norinchukin Bank
    • The Royal Bank of Scotland Group
    • UBS AG

     

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  • How Barclays Rigged Bank Rates- emails

    See how greed unfolds and how people callous people are!

    ‘Devastating emails today lay bare how top banks rigged crucial interest rates to mask the scale of their bad debts.

    They show how bonus-hungry traders promised each other bottles of Bollinger champagneto fix the figures that affect millions of homeowners and small firms.

    HOW BARCLAYS TRADERS CONSPIRED TO FIX THE MARKETS

    Barclays PLC President Bob Diamond Between 2005 and 2009, more than 200 requests were sent, usually by email or instant messenger – by traders to the Barclays Libor submitters.

    In one example of several provided by the FSA, a trader emailed the Barclays Libor submitter in March 2006, writing: ‘The big day [has] arrived… My NYK are screaming at me about an unchanged 3(month) libor. As always, any help wd be greatly appreciated. What do you think you’ll go for 3(month)?’

    The submitter replied: ‘I am going 90 altho 91 is what I should be posting.’

    The trader thanked him, saying: ‘..when I retire and write a book about this business your name will be written in golden letters.’

    The submitter then replied: ‘I would prefer this [to] not be in any book!’

    In another example from April 2006, a trader requested low one month and three month US dollar Libor rates shortly before the submission was due.

    He asked: ‘If it’s not too late low 1m and 3m would be nice, but please feel free to say “no”… Coffees will be coming your way either way, just to say thank you for your help in the past few weeks.’

    The submitter replied: ‘Done… for you big boy.’

    ————–

    “Last night – as Barclays was fined a record £290million for its part in the scandal – MPs said the police should be called in to investigate the ‘appalling’ conduct.

    The conspiracy involved interest rates on the wholesale money markets, where banks lend to each other.

    Traders colluded to set artifically low rates to con the markets into believing the banks were in good financial shape in the run-up to the credit crunch.

    Fixing the figures also allowed bankers to make money by taking out bets on the way the rates would move.

    The wholesale rates affect homeowners because they influence how much they pay on variable rate loans and mortages.

    Yesterday senior executives at Barclays said they would give up their bonuses for this year as a result of the record fine.

    THE DAMNING E-MAILS

    But the City regulator said other banks were caught up in the probe – with Lloyds, HSBC and Royal Bank of Scotland admitting they were also being investigated.

    The revelations throw fresh scrutiny on an industry already marred by public outrage at sky-high bonuses, mis-selling scandals and the RBS computer glitch chaos.

    In one of the emails, a trader at a different bank wrote to ‘Trader G’ at Barclays: ‘Dude. I owe you big time! Come over one day after work and I’m opening a bottle of Bollinger.’

    Other emails revealed how they would ‘shout’ across the desk at each other to ‘beg’ for the interest rate to be fixed at a certain level in the hope of making millions for themselves.

    Another said: ‘Coffees will be coming your way either way, just to say thank you for your help in the past few weeks.’

    His colleague replied: ‘Done…for you big boy.’

    The devastating 44-page dossier, published by the Financial Services Authority, revealed the ruthless tactics used by traders to try to fix the wholesale rates – known as the London Interbank Rate (Libor) and the European Interbank Rate (Euribor).

    Chief executive Bob Diamond apologised for the incident Sorry: Chief executive Bob Diamond apologised for the incident and will forgo his bonus this year

    They wanted to keep the rates artificially low as a high Libor rate suggests a bank is weaker than other banks because it is being charged a higher rate of interest to borrow money.

    It is understood that between ten and 20 rogue dealers were involved, all of whom are being or have been dismissed.

    Last night the chairman of the Commons Treasury committee Andrew Tyrie said Mr Diamond would be summoned to explain what had happened.

    ‘This is appalling. It just beggars belief that this sort of attitude should have been so widespread,’ he told Channel 4 News.

    ‘The crucial thing now is to make sure that it is being cleared up. That is why we will be calling in (Barclays chief executive) Bob Diamond to make sure that what’s required had been done in Barclays to improve the culture.

    ‘Banks were clearly acting in concert. I fear it’s not going to be the end of the story, that we are going to find that other banks have been involved.’

    But Labour’s financial spokesman Chris Leslie said the situation was so serious it may have to go ‘beyond the regulators and into a criminal investigation’.

    http://www.dailymail.co.uk/news/article-2165468/Bob-Diamond-shamed-giving-bonus-Barclays-fined-290m-attempting-rig-money-markets.html

    Related articles

  • Barclays Bank Attempts to Manipulate Borrowing Rate

    Bye Barclays Bank II
    Bye Barclays Bank II (Photo credit: George Rex)

    Barclays are caught in the act.

    Others are not.

    Gold price also has the similar story.

    ‘Ours is not to reason why’ -but to suffer.

    ‘The British and US authorities said they had found evidence Barclays had attempted to manipulate a key borrowing rate for years, meaning that home owners could have paid millions more in mortgage payments than they might otherwise have had to.

    Traders at the bank were discovered to have engaged in regular attempts to determine the London Interbank Offered Rate (Libor) from as early as 2005.

    The manipulation of Libor saw the bank make submissions to the setters of the rate that they knew to be wrong as they attempted to influence the level at which it was fixed.

    Barclays also attempted to suppress Libor, which means that savers could have potentially lost out on millions in interest due to the rate being lower than it should otherwise have been.

    Barclays chief executive Bob Diamond is to forgo his bonus after the bank was fined a total of £290m.

    Andrew Tyrie MP, chairman of the Treasury Select Committee, said: “This was a serious breach. I am very concerned about it. The price setting mechanism of Libor is crucial to the integrity of the markets. This appears to have been put at risk. From the information I have, it looks inexcusable.”

    The US Commodity Futures Trading Commission (CFTC) handed the bank a $200m (£128m) penalty for “attempted manipulation of and false reporting concerning Libor and Euribor benchmark interest rates”, while Barclays has agreed to pay a $160m penalty as part of an agreement with the US Justice Department.

    David Meister, the CFTC’s director of enforcement, said: “The American public and our markets rely upon the integrity of benchmark interest rates like LIBOR and Euribor because they form the basis for hundreds of trillions of dollars of transactions and affect nearly every corner of the global economy.

    “Banks that contribute information to those benchmarks must do so honestly. When a bank acts in its own self-interest by attempting to manipulate these rates for profit, or by submitting false reports that result from senior management orders to lower submissions to guard the bank’s reputation, the integrity of benchmark interest rates is undermined. The CFTC launched this investigation to protect the markets and the public from such illegal conduct, and today’s action demonstrates that we will bring the full force of our authority to bear as we carry out that mission.”

    The UK’s Financial Services Authority has imposed its largest ever penalty of £59.5m.

    The CFTC found that finds that “Barclays attempted to manipulate and made false reports concerning two global benchmark interest rates, Libor and Euribor, on numerous occasions and sometimes on a daily basis over a four-year period, commencing as early as 2005”.

    Libor is used to price more than £200 trillion of financial products around the world, including everything from home loans to the most complex credit derivatives. Euribor measures the cost of borrowing in the European Union.

    In a statement, Mr Diamond said that he and three other senior managers would hand back their bonuses for 2012 in light of the fines: “The events which gave rise to today’s resolutions relate to past actions which fell well short of the standards to which Barclays aspires in the conduct of its business.’

    http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9359362/Bob-Diamond-forgoes-bonus-as-Barclays-fined-for-Libor-manipulation.html