For the second time in the last four years, British bank Barclays PLC has agreed to pay out a large sum of money to settle accusations it manipulated a major benchmark interest rate in London.
Barclays agreed Monday to pay $100 million to nearly every U.S. state, which brought a lawsuit against the bank claiming it unlawfully manipulated the London interbank offered rate (LIBOR), which is used to set prices in consumer transactions, for years during the 2000s.
According to the 44 plaintiff states in the suit, the bank and employees artificially manipulated Libor prices with agreements that defrauded government agencies and nonprofits out of millions of dollars, The New York Times reported.
The accusations said Barclays’ motive was to improve the appearances of the bank’s fiscal health during the financial crisis — at the expense of the government and nonprofits.
Barclays, the first bank to settle the claims of Libor tampering, said it agreed to the settlement because it represented the least potential for damage.
“We believe this settlement is in the best interests of our shareholders and clients, and allows us to continue to focus on the future,” the bank said.
Monday, though, wasn’t the first time Barclays agreed to pay tens of millions over claims of Libor manipulation. Between 2012 and 2014, the bank agreed to pay nearly $460 million for admitting it submitted false Libor rates and violated a non-prosecution agreement with U.S. regulators.
“There has to be one set of rules for everyone, no matter how rich or how powerful, and that includes big banks and other financial institutions that engage in fraud or impair the fair functioning of financial markets,” New York Attorney General Eric Schneiderman, one of the suit’s plaintiffs, said in a statement Monday.
“This settlement is the first, but certainly not the last, with major international financial institutions that manipulated interest rate benchmarks for their own gain,” Maryland Attorney General Brian Frosh added.