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FCA fines brokerage £630k for Libor fixing
by Robert St George on May 15, 2014 at 13:49
The Financial Conduct Authority (FCA) has fined Martin Brokers £630,000 for misconduct relating to the manipulation of the London Interbank Offered Rate (Libor).
Between January 2007 and December 2010, the firm colluded with a trader at UBS to manipulate the Japanese yen Libor rates.
Specifically, Martin Brokers deliberately disseminated incorrect and misleading Libor submissions by sending skewed reports to some Libor panel banks and by creating false orders to influence those panel banks’ views of the market.
The UBS trader also made corrupt payments to reward Martin Brokers for its involvement.
The FCA noted that Martin Brokers’ misconduct was exacerbated by a ‘heavy focus on revenue at the expense of regulatory requirements’.
‘Interdealer brokers are expected to act as trusted intermediaries and are key conduits of market information,’ said Tracey McDermott (pictured), director of enforcement and financial crime at the FCA.
‘The culture at Martins was that profit came first. In this environment, broker misconduct was almost inevitable.’
The brokerage would have been fined £3.6 million but this was reduced because the company showed that it could not pay a penalty of that amount. The fine was further lowered by 30% because Martin Brokers agreed to settle at an early stage of the investigation.
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