The European Commission said on Tuesday it believes British-based broker ICAP may have helped rig interest rates vital for the global financial markets in a global scandal which has cost billions in fines. The Commission, the European Union''s executive arm, said its preliminary view was that ICAP had colluded with others to manipulate interest rate derivatives denominated in yen.
The Commission gave no further details of its findings against ICAP and cautioned in a standard statement that notifying the company of its suspicions did not prejudge the outcome of the enquiry. Notification will allow the company to respond formally to the Commission.
British and US regulators fined ICAP a combined 130 million euros in September for its role in rigging Libor interest rate instruments in London. Libor is a global benchmark used to calculate the price of a vast range of loans and other debt instruments globally worth trillions. Libor rates - and those of its equivalents priced in euros or yen - are based on quotes submitted by the banks but this system has been found to be open to abuse and manipulation. The EU, British, and US and other regulators have levied huge fines on some of the world''s biggest banks and investment houses.
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