The investigation of numerous international banks accused of rigging the London interbank offer rate (LIBOR) looks set to claim another quarry as Royal Bank of Scotland will reportedly be fined about 150 million pounds ($233 million).
Barclays was already fined $450 million on Wednesday by U.S. and U.K. authorities for its role in the scheme, and its CEO, Bob Diamond, said he did not intend to step down as one British lawmaker called for criminal charges against the bank’s executives.
Reuters reported Friday that RBS was to pay the hefty fine for its part in market manipulation activities similar to those of Barclays. More banks are expected to follow as action continues. AdvisorOne reported Thursday that it was among more than a dozen banks being investigated by regulators; so are Citigroup, UBS, ICAP, Lloyds Banking Group and Deutsche Bank.
In addition, Britain’s Financial Services Authority (FSA) announced it had settled with four banks—Barclays, RBS, HSBC and Lloyds—on the basis of evidence that they missold products to protect small businesses against a rise in interest rates—just the latest misselling case amid a string of such instances, the latest of which was a loan insurance debacle that is likely to result in banks paying upwards of 9 billion pounds for their misdeeds. In the current case, the FSA said that from 2001 to the present, banks sold around 28,000 interest rate protection products to customers.
Barclays said in the report that it was continuing to cooperate with investigators; the case is likely to drag on for months and attorneys have said that compensation could amount to hundreds of millions of pounds. Lloyds said that its cost would not be material.
Prime Minister David Cameron has said that Diamond and other bank executives had some “big questions to answer” about the rigging that occurred in 2005 to 2009. “People have to take responsibility for the actions and show how they’re going to be accountable,” Cameron was quoted saying in a Bloomberg report. He spoke from Brussels and added, “It’s very important that goes all the way to the top of the organization.”