UBS AG 2: A brief description of the kind of Libor fixing

From yesterday's Daily Telegraph, a good briefing of what UBS AG was upto in Japan with it's Yen Libor rate fixing activity.

How UBS built its Libor racket

UBS AG is fined $1.53bn for Libor rate fixing. 1

 

UBS has reached a settlement with the UK Financial Services Authority (FSA) concerning its investigation. The Swiss Financial Market Supervisory Authority (FINMA) will also issue an order concluding its formal proceedings with respect to UBS.

 

The fines are announced.

The UBS AG press release is quoted here:  UBS AG is fined.

 

In short:

• UBS has agreed to pay a total of approximately $1.53bn in fines.
• UBS will pay $260m in fines to the FSA and $64.7m as disgorgement of estimated profits to FINMA.
• The Board has authorised a payment of fines totalling $1.2bn to the DoJ and CFTC, and expects those authorities to make further announcements later today.
• UBS was libor fixing encompassed by the settlements includes Yen LIBOR, GBP LIBOR, CHF LIBOR, Euro LIBOR, USD LIBOR, Euribor and Euroyen TIBOR, although the nature and extent of the conduct in question varied significantly from one currency to another.

The conduct described in the settlements includes the following:

1. • Certain UBS personnel engaged in efforts to manipulate submissions for certain benchmark rates to benefit trading positions;
2. • Certain employees at the bank colluded with employees at other banks and cash brokers to influence certain benchmark rates to benefit their trading positions; and
3. • Certain personnel gave inappropriate directions to UBS submitters that were in part motivated by a desire to avoid unfair and negative market and media perceptions during the financial crisis.

 

 NB in the UK the Serious Fraud Office is still investigating, in Switzerland civil suits are coming in and I suspect that we have not hear the last of this story yet.

 

I'll write a fuller update of this story as the information develops during the day.

 

Your comments are of course welcome.

UBS said to face fines libor fixing probe

I am going to be reviewing UBS and it's regulatory fines over the last decade on this blog, over the next week or so.

In the meantime heres a news story about UBS and Libor rigging. I'd draw your attention to the list of of exemptions form prosecution at the end of the article. business.financialpost.com/2012/12/13/

Your comments are, of course, welcome.

Birkenfeld Gets 40 Months in jail

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The Washington post has reported that Bradley C. Birkenfeld, a former banker for Swiss banking giant UBS and who helped U.S. officials uncover billions of dollars in taxpayer money in secret bank accounts was sentenced on the 21st August 2009.

He pleaded guilty last year to the criminal charge of assisting UBS (and some of its US clients) evade the USA’s tax collectors, the Internal Revenue Service. As he is still helping the authorities with their enquiries, he will start his term on 8th January 2010.

Mr Birkenfeld had asked to be sentenced only to probation, federal prosecutors had asked that he be given 30 months but in the end a federal judge gave him 40 months. The sentence does leave me wondering about whether the Judge accepted his motivation for blowing the whistle as being entirely pure?