Fixed Rates, Declining Trust

Wednesday, July 04, 2012

British bank Barclays chairman Marcus Agius British bank Barclays chairman Marcus Agius (Pierre Verdy/Getty)

The Royal Bank of Scotland has become the latest bank to get hit with a fine for their role in an interest rate rigging scandal. They’ll have to pay £150 million pounds — that’s about $233 million.

The Libor rigging scandal, as its called, lead to the Barclays CEO stepping down yesterday. And this sort of rate fixing isn’t just in the United Kingdom — one of Royal Bank of Scotland’s subsidiaries, NatWest, was named in a bid-rigging lawsuit, along with popular American banks such as Morgan Stanley, JP Morgan, and Bank of America.

William Cohan used to work with JP Morgan, and is now a financial journalist and author. His most recent book is “Money and Power: How Goldman Sachs Came to Rule the World.” And he says this sort of rate fixing undermines the public's faith in capitalism.


William D. Cohan

Produced by:

Rupert Allman and John Light

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