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Fed knew about Libor rigging in 2008
The US Federal Reserve knew about Libor rigging three years before the financial scandal exploded but did not take any firm action, documents have revealed.
According to newly published transcripts of the central banks meetings in the run-up to and immediate aftermath of the collapse of Lehman Brothers, a senior Fed official first flagged the issue at a policy meeting in April 2008.
William Dudley expressed fears that banks were being dishonest in the way they were calculating the London interbank offered rate a global benchmark interest rate used as the basis for trillions of pounds of loans and financial contracts.
There is considerable evidence that the official Libor fixing understates the rates paid by many banks for funding, he said.
http://www.telegraph.co.uk/finance/libor-scandal/10654977/Fed-knew-about-Libor-rigging-in-2008.html
Ichingcarpenter
(36,988 posts)The 21st has been a banner century for financial and accounting scandals. Enron, the dotcom bust, the subprime-mortgage crisis and the bank bailouts have all contributed to the very low esteem in which the American public holds Corporate America in general, and high finance in particular. So it is no small feat that the latest interest-rate-fixing LIBOR scandal is being heralded as the most egregious in a generation or, as Robert Scheer put it in the Nation, the crime of the century.
Read more: Is the LIBOR Scandal the Crime of the Century? | TIME.com http://business.time.com/2012/07/09/libor-scandal-the-crime-of-the-century/#ixzz2uBOOpvqN
Libor: The Crime of the Century
Forget Bernie Madoff and Enrons Ken Laythey were mere amateurs in financial crime. The current Libor interest rate scandal, involving hundreds of trillions in international derivatives trade, shows how the really big boys play. And these guys will most likely not do the time because their kind rewrites the law before committing the crime.
Modern international bankers form a class of thieves the likes of which the world has never before seen. Or, indeed, imagined. The scandal over Liborshort for London interbank offered ratehas resulted in a huge fine for Barclays Bank and threatens to ensnare some of the worlds top financers. It reveals that behind the worlds financial edifice lies a reeking cesspool of unprecedented corruption. The modern-day robber barons pillage with a destructive abandon totally unfettered by law or conscience and on a scale that is almost impossible to comprehend.
How to explain a $450 million settlement for one bank whose defense, in a plea bargain worked out with regulators in London and Washington, is that every institution in their elite financial circle was doing it? Not just Barclays but JPMorgan Chase, Citigroup and others are now being investigated on suspicion of manipulating the Libor rate, so critical to a $700 trillion derivatives market.
http://www.thenation.com/article/168751/libor-crime-century
El_Johns
(1,805 posts)Marr
(20,317 posts)to service an incredibly small, ridiculously wealthy group of people.
The scope is almost unimaginably galling. It's like a man refusing to unscrew a lightbulb, and instead forcing 100,000 people to pick up the city block he's standing on and rotate it around him instead.
I'm not surprised that the Feds knew about it one bit. They seem to consider financial industry crooks to be their superiors.
woo me with science
(32,139 posts)Ichingcarpenter
(36,988 posts)Federal Reserve is investigating whether traders at the worlds biggest banks rigged benchmark currency rates, raising the risk that firms will be penalized for lax controls as regulators look for wrongdoing.
The Fed, which supervises U.S. bank holding companies, is among authorities from London to Washington probing whether traders shared information that may have let them manipulate prices in the $5.3 trillion-a-day foreign-exchange market to maximize their profits, said a person with direct knowledge of the matter, asking not to be named because its confidential.
http://www.bloomberg.com/news/2014-01-13/federal-reserve-said-to-probe-banks-over-forex-fixing.html
Just wanted to throw that story in here after reading the first one.......LOL
'''SAID'''' is the key word
2banon
(7,321 posts)One could reasonably presume during this crises, dealing with the LIBOR racket was just one too many fires to put out... you know... if you're standing in the eye of a fire storm vortex, some homes or trees will be sacrificed or just impossible to deal with in the effort to contain it.
However, "knowing what we already know"... I'd venture to guess that the LIBOR racket was known by the FEDS for a long time... It would be interesting to read/hear Matt Taibbi's take on that aspect. What has he learned and written on that point I wonder.. ?
Hekate
(90,793 posts)Yet another bleeping Bush legacy.
Ichingcarpenter
(36,988 posts)independent of the white house. It was set up by JP Morgan.
the Federal Reserve System "is considered an independent central bank because its monetary policy decisions do not have to be approved by the President or anyone else in the executive or legislative branches of government, it does not receive funding appropriated by the Congress, and the terms of the members of the Board of Governors span multiple presidential and congressional terms
The Federal Reserve System is a part of government that regulates the private banks. The Board also plays a major role in the supervision and regulation of the U.S. banking system. It has supervisory responsibilities for state-chartered banks[50] that are members of the Federal Reserve System,http://en.wikipedia.org/wiki/Criticism_of_the_Federal_Reserve
Scuba
(53,475 posts)Ichingcarpenter
(36,988 posts)to a gold audit of fort knox, since it hasn't been done since 1953
you would think after 911 one would think that might be a good idea.
joanbarnes
(1,723 posts)KoKo
(84,711 posts)RICO? (doesn't seem to exist anymore) Class Action? (takes a long time and only gets folks a bit of money after lawyer fees).
Why are Wall Street and Banks allowed to pay a fine and those at the top are never held accountable? More and More average citizens are starting to ask that question because it seems the Crooks & Criminals are winning and the rest of us keep losing.