As the British government's way to crack down unscrupulous traders who manipulate currency rates or borrowing costs, Bloomberg said that Chancellor of the Exchequer George Osborne will be announcing plans on amending laws that would criminalize benchmark rigging.
According to a statement by the UK Treasury ahead of scheduled speeches by Osborn and Bank of England Governor Mark Carney at at London's Mansion House today, the government is poised to extend existing laws that would impose as much as seven years in jail for individuals who have been convicted of Libor manipulation to gauges used in foreign-exchange, fixed-income and commodity markets. Bloomberg said that the planned measures are part of a review by the Treasury, BOE and the Financial Conduct Authority on how markets operate.
The Treasury statement also include the speech planned to be said by Osborne at the Mansion House, which read, "Markets here set the interest rates for people's mortgages, the exchange rates for our exports and holidays, and the commodity prices for the goods we buy. I am going to deal with abuses, tackle the unacceptable behavior of the few and ensure that markets are fair for the many who depend on them."
The news agency said the planned measures followed scandals that rocked the financial industry in the UK. Regulators from three continents have already launched proves to investigate allegations of probing the $5.3 trillion-a-day currency market, while concern about the vulnerability of benchmarks to abuse such as the London gold fixing are growing. At least nine firms so far had been fined over $6 billion for manipulating the London interbank offered rate, and that the investigation has yet to finish.
Senior London-based trial lawyer Robert Rhodes said, "From the point of view of the reputation for the City of London and our financial services, the cleaner we're seen to be, the better in the long run. It is perhaps surprising that more benchmarks weren't dealt with at the time they dealt with the Libor scandal. The government has obviously now realized the seriousness and breadth of this issue."
