Thursday, September 27, 2012

Senior RBS traders 'rigged interest rates months before £45bn bailout' from taxpayer

Senior traders at Royal Bank of Scotland allegedly boasted of running a ‘cartel’ in London to rig crucial interest rates just months before it received a £45billion bailout from taxpayers, court papers reveal.

RBS – which is 81 per cent owned by the taxpayer – is suspected of taking part in a global conspiracy to manipulate benchmark Libor rates, which determine how much homeowners pay on their mortgages.

The transcripts of messages between the bank’s former traders in London and Singapore are in legal papers filed by Tan Chi Min, a former senior trader who is suing RBS for wrongful dismissal.

Tan, who was fired last year for trying to manipulate Libor, claims rate-rigging was condoned by the bank’s senior management.

Bonus-hungry traders have been accused of profiteering by manipulating Libor in order to fix huge bets on complicated investments. Read More