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Nice Libor! The staggering secret RBS messages
by Sarah Miloudi on Feb 06, 2013 at 15:51
America's Commodity Futures Trading Commission (CFTC) has published some of the staggering deals made by Royal Bank of Scotland's Libor setters, which led to a £390 million fine for the bank.
The CFTC said: 'RBS created an environment for a number of years that eased the path to manipulation by placing derivatives traders and submitters together on the same desk, heightening the conflict of interest between the profit motives of the traders and the responsibility of submitters to make honest submissions.'
To highlight this the CFTC published a series of messages sent via email and other instant messaging tools. Here is an example of some of the worst instances and admissions of Libor lowballing:
August 20, 2007:
Yen Trader 1: Where’s young [Yen Trader ] thinking of setting it?
Yen Trader 2: Where would you like it? Libor that is.
Yen Trader 1: Haha, glad you clarified! Mixed feelings but mostly I’d like it all lower so the world starts to make a little more sense.
August 20, 2007:
Senior Yen Trader: This Libor setting is getting nuts.
Senior Yen Trader 1: It's just amazing how libor fixing can make you that much money.
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