This post was contributed by a community member. The views expressed here are the author's own.

Politics & Government

Nine More Banks Subpeonaed in Libor Probe

The investigation, a joint effort between New York and Connecticut, is focused on interest-rate manipulation.

Nine more banks have been slapped with subpoenas in connection with an investigation into alleged interest-rate manipulation by banks, an inside source shared with the Wall Street Journal (paywall).

Banks that received subpoenas include: Bank of America Corp., Bank of Tokyo Mitsubishi UFJ, Credit Suisse Group AG, Lloyds Banking Group, Rabobank Groep NV, Royal Bank of Canada, Société Générale, Norinchukin Bank and West LB AG, according to the person familiar with the investigation.

The probe is a joint effort between the offices of New York Attorney General Eric Schneiderman and Connecticut Attorney General George Jepsen. The subpoenas  – issued in August and September, but not previously reported on – bring the total number of subpoenas in the case to 16.

Find out what's happening in Carroll Gardens-Cobble Hillwith free, real-time updates from Patch.

According to the Journal, the banks under investigation employ most members of the panel that helps set the dollar London interbank offered rate (Libor). Several banks are accused of rigging Libor.

The New York-Connecticut Libor investigation focus on how Libor rates could have affected investors, state agencies and municipalities that invested in interest-rate swaps tied to the rate to help manage their debt costs, according to the paper. The losses that occurred because of rate manipulation could have a direct impact on state finances. Interest-rate investigations are also occurring in other states, including Massachusetts and Florida, the Journal previously reported.

Find out what's happening in Carroll Gardens-Cobble Hillwith free, real-time updates from Patch.

In July, Barclays paid about $450 million to U.S. and U.K. regulators as part of a settlement in which the London bank admitted that executives and traders had manipulated Libor. The firm's CEO and chairman has since resigned.

Attorney General Schneiderman was appointed by President Barack Obama in January to head a joint committee investigating the national mortgage crisis. Since then, a number of banking resolutions have passed in New York State.

We’ve removed the ability to reply as we work to make improvements. Learn more here

The views expressed in this post are the author's own. Want to post on Patch?

More from Carroll Gardens-Cobble Hill