Bank of America, Citigroup and Credit Suisse were among 16 of the world’s biggest banks sued by the U.S. Federal Deposit Insurance for allegedly manipulating the London interbank offered rate from 2007 to 2011.
Bloomberg reports that the FDIC, acting as receiver for 38 failed banks including Washington Mutual Bank, IndyMac Bank FSB and Colonial Bank, claimed that institutions sitting on the U.S. dollar Libor panel 'fraudulently and collusively suppressed' the rate.
Also named in the suit, filed in Manhattan federal court, is the British Bankers Association, an industry group that oversaw Libor.
Regulators around the world have been probing whether firms colluded to manipulate interest-rate benchmarks including Libor, which affects more than $300tril of securities worldwide. Financial institutions have paid about $6bn so far to resolve criminal and civil claims in the U.S. and Europe that they manipulated benchmark interest rates.
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