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SFO will investigate Libor fixing
The Serious Fraud Office has confirmed that it will launch an investgation into the scandal of banks fixing the Libor interest rate.
In a 17-word statement the SFO said that its director David Green had 'decided to formally accept the Libor matter for investigation'.
This follows reports that the agency, which has had its budget slashed, will get new resources from the chancellor George Osborne to pursue a criminal investigation.
Last week, when the scandal broke and fines of £290 million were imposed on Barclays, the SFO said it would decide in a month whether to press criminal charges.
'The issues are complex and the assessment of the evidence the Financial Services Authority has gathered will take a short time, but we hope to come to a conclusion within a month,' the SFO said at the time.
Today's move indicates how politically charged the affair has become. Yesterday Osborne clashed with Ed Balls, his opposite number on the Labour front bench, over his allegation that Labour had been involved in a cover-up to keep inter-bank lending rates low. Balls, who was family minister at the time but who had been an aide of Gordon Brown, denied the allegation.
Last year the SFO's former director Richard Alderman decided not to open a Libor investigation, saying he did not have the resources do to the job and that it might overlap with work by the Financial Services Authority and the Office of Fair Trading.
The agency has been been criticised for its lack of success in winning big fraud cases. Its reputation was harmed by a botched investigation into property developers the Tchenguiz brothers.
Any prosecution would be brought under the Fraud Act 2006, under which individuals can be jailed for up to 10 years. However, the investigation is bound to be long and complex, involving other banks in addition to Barclays, whose chief executive Bob Diamond and chief operating officer Jerry del Missier have resigned in the fallout from the fines.
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- Four! Questions Bob 'Boycott' Diamond didn't answer
- Diamond tells MPs: 'I don’t feel personal culpability'
- Bob Diamond quits Barclays after threat to regulators
- Q&A: what is Libor and what did the banks do to it?
- Barclays names del Missier as most senior rate-rigger
- Tchenguiz brothers arrested in Icelandic bank swoop
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