Question

Read Finance in Action Ethics on page 232: "LIBOR Price-Fixing Scandal" please comment after reading.

Answer 1

The libor scandal was a series of rodent action connected to the libor London interbank offered rate and also the resulting investigation and reaction the liver is an average interest rate calculated through submission of interest rate by major banks across the world the scandal a rose when it was discovered that banks were falsely inflating and Dee flirting their rates so as to profit from from trade sir to give the impression that there were more creditworthy than they were libor underpins approximately dollar 350 trillion in derivatives it is currently administrated by Intercontinental exchange which took over running in the libor in January 2014 the banks was supposed to submit the actual interest rate they are paying or would expect to pay for boring from other banks the liver is supposed to be the total assessment of the health of the financial system because if the banks being pulled feel confident about the state of things day report a loan number and if the number banks feel alone degree of confidence in the financial system the report a higher interest rate. It was a event speaking in 2008 in which the Financial Institutions were accused of fixing the London interbank offered rate in Financial Institutions providing information on the interest rate they would use to calculate the London it was offered rate

The Bachelors of bankers involved in the scandal became evident as emails in phones recorded were released during investigation everything showed traders openly asking others to set rates at specific amount so that a position would be profitable regulator in both the united states in United Kingdom levied dollar 9 villain of find on banks involved in the scandal as well as a slew of criminal charges because libor is used in the pricing of many financial instruments corporations and governments have also affected lawsuits allergen that the rate fixing negatively affected them

Following the unveiling of the libor collision Britain's financial conduct authority removed supervision from the British bankers Association in delivered to the IC benchmark administration it is an independent UK subsidiary of private US based exchange operator Intercontinental exchange.libor is now known as libor ice this shift been significant in restoring its credibility and integrity