The U.S. Justice Department is set to rip up its agreement not to prosecute UBS for rigging benchmark interest rates, according to a person familiar with the matter, taking a new step to hold banks accountable for repeat offences.
Bloomberg News reports that the move by the U.S. would be a first for the industry, making good on a March threat by a senior Justice Department official to revoke such agreements and putting banks on notice that these accords can be unwound if misconduct continues.
UBS is among the five banks that are poised to reach settlements with U.S. regulators over allegations that they manipulated currency markets, people familiar with the situation have said. Four of them - Citigroup, JPMorgan, Barclays and Royal Bank of Scotland - will likely enter pleas related to antitrust violations, people familiar with the talks have said.
UBS’s cooperation in the currency probe may help shield it from antitrust charges in that matter. However, the bank is still exposed to fraud charges in that case, and any admission of wrongdoing could also put it in violation of an earlier deal the bank struck with the Justice Department.
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