GENEVA (TheBlaze/AP) — Swiss bank UBS agreed Wednesday to pay $1.5 billion in fines for trying to manipulate a key interest rate that affects borrowers around the world.
The settlement with U.S., British, and Swiss regulators caps a tough year for the company and the reputation of the global banking industry. The fine on UBS, which will also see two former traders charged with conspiracy, is triple the amount that British bank Barclays PLC agreed to pay in June to settle similar charges.
And it comes a week after HSBC agreed to pay nearly $2 billion to settle allegations of laundering money for Mexican drug cartels and countries under U.S. embargoes, such as Iran.
UBS, Switzerland’s largest bank, said some of its employees tried to rig the LIBOR rate — short for London Interbank Offered Rate — in several currencies. The rate is set daily using information that banks provide and is used to price trillions of dollars in contracts around the world, including mortgages and credit cards.
(RELATED: ‘Where Is the Press With the Outrage?’ This Major Financial Scandal Has Santelli Up in Arms)
Some UBS traders voluntarily submitted — or pressured others to submit — inaccurate data to gain some financial advantage.
The bank’s Japan unit, where much of the manipulation took place, entered a plea to one count of wire fraud in an agreement with the U.S. Justice Department.
The Justice Department said two former UBS senior traders, Tom Alexander William Hayes, 33, of Britain, and Roger Darin, 41, of Switzerland, will be charged with conspiracy, while Hayes also will be charged with wire fraud in New York federal court. Justice Department officials said they believed the two men were in Britain and Switzerland, and would be seeking their extradition.
UBS will pay $1.2 billion of its fine to the Justice Department and U.S. Commodity Futures Trading Commission. The CFTC will get $700 million, the largest fine it ever ordered. The remaining $300 million will go to regulators in Britain and Switzerland.
As a result of the fines, litigation, unwinding of real estate investments, restructuring, and other costs, UBS said it expects to lose between 2 billion and 2.5 billion Swiss francs ($2.2 billion to $2.7 billion) in the fourth quarter. Nevertheless, the Zurich-based bank maintained that it “remains one of the best capitalized banks in the world.”

Employees walk past a logo of the Swiss banking giant UBS in Zurich. British, US and Swiss regulators hit Swiss banking giant UBS with fines of $1.5 billion. (AP)
The LIBOR scandal is likely to make headlines again in coming months. Other big global banks are also being investigated for rigging the same market and are expected to be fined.
UBS said some of its personnel had “engaged in efforts to manipulate submissions for certain benchmark rates to benefit trading positions” and that some employees had “colluded with employees at other banks and cash brokers to influence certain benchmark rates to benefit their trading positions.”
Britain’s financial regulator called the misconduct by UBS “extensive and broad,” with the rate-fixing carried out from UBS offices in London and Zurich.
Different desks were responsible for different rate submissions. At least 2,000 requests for inappropriate submissions were documented. An unquantifiable number of oral requests were also made, the U.K.’s Financial Services Authority said.
“Manipulation was also discussed in internal open chat forums and group emails, and was widely known,” the FSA said. “At least 45 individuals including traders, managers and senior managers were involved in, or aware of, the practice of attempting to influence submissions.”

UBS said some of its personnel had “engaged in efforts to manipulate submissions for certain benchmark rates to benefit trading positions.” (Getty Images)
With more than 2.2 trillion Swiss francs ($2.4 trillion) in invested assets, UBS is one of the world’s largest managers of private wealth assets. At last count, the bank had 63,745 employees in 57 countries and said it aims for a headcount of 54,000 in 2015.
Along with Credit Suisse, the second-largest Swiss bank, UBS is on the list of the 29 “global systemically important banks” that the Bank for International Settlements – the central bank for central banks – considers too big to fail.
It’s not the first time that UBS has fallen afoul of regulators. In 2009, U.S. authorities fined UBS $780 million for helping U.S. citizens avoid paying taxes.
The U.S. government has since been pushing Switzerland to loosen its rules on banking secrecy. The country has been trying to shed its image as a tax haven, signing deals with the U.S., Germany and Britain to provide greater assistance to foreign tax authorities seeking information on their citizens’ accounts.
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Goldi-lox
Dec. 21, 2012 at 1:21amToo bad we don’t have OLD HICKORY around any more… These d*mned banks need to be put in their place.
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valiant1776
Dec. 20, 2012 at 8:12pmCNBC Exec’s Children Murdered, 1 Day After CNBC Reports $43 Trillion Bankster Lawsuit
http://12160.info/profiles/blogs/cnbc-exec-kevin-krim-s-children-murdered-1-day-after-cnbc-reports
Nanny suspected of killing 2 children of CNBC executive
http://www.nj.com/news/index.ssf/2012/10/nanny_suspected_of_killing_2_c.html
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DonnieD
Dec. 20, 2012 at 5:21pmI guess they were not nut real this time.
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carpedeum
Dec. 20, 2012 at 3:47pmSomething else about this scandal that needs to be discussed is the connection that 3 recent, major shootings/massacres have in common. The one in Colorado, the one in Annetta, TX, and this last one in CT. All of the dads of these shooters are involved with this scandal and are supposed to be testifying. The author of this article linked below asks some good question. Can somebody please find the answers. I hope there are no more witnesses set to testify.
http://shortlittlerebel.wordpress.com/2012/12/16/urgent-update-on-connecticut-shooting/
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KidCharlemagne
Dec. 20, 2012 at 12:34pmMost people aren’t even smart enough to realize that the purchasing power of their dollars, value of their retirement accounts, value of their homes, etc. are (at least in part) propped up through the recycling/reinvestment of narcodollars by the drug cartels into legitimate assets (treasury bonds, stocks, energy funds, ETFs, etc., etc.)
If the recycling of drug dollars ever suddenly stopped, then it’s conceivable (in theory anyway) that one of these institutions that has grown dependent on the recycling of drug dollars over the years could actually collapse and subsequently trigger a banking panic.
This is why nobody ever goes to jail (and why no one will ever go to jail) for laundering drug cartel money (unless you’re a small-time peasant of course who is only laundering a million or two here and there).
What would happen if the drug cartels stopped laundering money into U.S. assets?……that’s the $64K question…
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desertspeaks
Dec. 20, 2012 at 1:21pmwe all know that the 1.5 billion fine was a pittance as to what the company actually made.. the fine is always much lower than what they actually made. the general rule for a fine from what I’ve seen, is usually 10% or less of what was STOLEN!
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Walkabout
Dec. 20, 2012 at 4:11pmdesertspeaks
You said it. That is why it is not a deterrent.
If they can’t be decent for decency’s sake then they need to fear the law.
They don’t. Even of they are caught, they get slapped on the wrist.
These LIBOR guys, I would feed to the OWS zombies & feel good about it. It would make for some good footage.
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shorelineliz
Dec. 20, 2012 at 12:20pmAdd UBS to Barclays and send all these criminals to jail!
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LiberatedCitizen
Dec. 20, 2012 at 3:44pmYea sure like that’s going to happen. I suspect the reason only some low level players were even charged is because UBS messed around with O’s golfing buddy
CONVICTED: Bush 1300+, Clinton 1000+, Obama 0.0 (+/-)
Report: Cronyism, political donations likely behind Obama, Holder failure to charge any bankers after 2008 financial meltdown
http://dailycaller.com/2012/08/07/report-cronyism-political-donations-likely-behind-obama-holder-failure-to-charge-any-bankers-after-2008-financial-meltdown/?print=1
via http://dailybail.com/home/convicted-bush-1300-clinton-1000-obama-00.html
UBS’s lies
http://blogs.reuters.com/felix-salmon/2012/12/19/ubss-lies/
The Justice Department’s criminal division, which arranged the guilty plea and a $100 million fine from the Japanese subsidiary, also struck a non-prosecution agreement with the parent company. That deal included a $400 million fine.
http://mobile.nytimes.com/dealbookarticle?articleId=545476
Obama’s ‘Banker BFF’ Is Now Obama’s ‘Self-Employed Consultant BFF’
Wolf is hanging his own shingle just a month after the Times reported that he had angered his bosses at UBS by golfing and going on vacation with the president.
http://nymag.com/daily/intelligencer/2012/07/obamas-banker-bff-leaves-ubs.html
Fannie Mae, Freddie Mac Libor Loss Tops $3 Billion in Audit
http://www.bloomberg.com/news/2012-12-19/fannie-mae-freddie-mac-libor-loss-tops-3-billion-auditor-says.html
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Proverbs17-12NLT
Dec. 20, 2012 at 10:52amBankingaghzi cover up on the horizon
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BrutalTruth
Dec. 20, 2012 at 10:49amA lot of money fraudulently passing hands (isn’t that the crux of the problem in the first place?).
Question is: Who went to prison? …….never mind.
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Proverbs17-12NLT
Dec. 20, 2012 at 10:53amThe Buck stops with Obama, Trillions of them.
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oldguy49
Dec. 20, 2012 at 10:56amwhy isn’t anyone going to prison…………oh……..just us regular folks go to prison for breaking the law
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Cavallo
Dec. 20, 2012 at 12:13pmI think they have been very careful about skirting the edge between fraud and collusion. If companies get together and fix prices, that’s not a personal criminal activity, and a civil tort that the company is punished for. If someone in the business takes your money through lies and misrepresentation, that would be fraud. I am sure someone will correct me if I am off the mark.
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UNALIEN
Dec. 20, 2012 at 1:17pmthe real question..
What is money???
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blanco5
Dec. 20, 2012 at 10:40amTime to do what Iceland did!!!!!
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barber2
Dec. 20, 2012 at 10:37amIsn’t Europe inching toward a unified bank control ? Is that what this is about ? Control ?
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Walkabout
Dec. 20, 2012 at 10:37amThis is easy. Consider the work of Francis & Mialon
The Optimal Penalty for Sexually Transmitting HIV. Francis, Andrew M.; Mialon, Hugo M
Tolerance and HIV Andrew M. Francis and Hugo M. Mialon September 3, 2009
The liberal blogosphere touted “Tolerance and HIV”. (I assume that libertarians would agree as well. I also assume that social conservatives would not & that they would have some very valid points). It was based on statistics. So from a analytical view point & an emotional (liberal ) view point, Francis & Mialon are golden boys.
So consider their work “The Optimal Penalty for Sexually Transmitting HIV”. In it they argue what the jail sentence should be to deter people from knowingly transmit HIV.
Well you can use the same logic here. 1.5 billion is not a large enough penalty in compoarisonb to the oll gotten profit they made. This does not deter them one bit. In fact it encourage them. The new crop will learn the lesson to be more careful not to get caught. Fi you do get caught it will not hurt much anyway. The penalty needs to be bigger.
And we should not listen to the Too Big to Fail (TBTF) argument. We can handle that. It is called bankruptcy. The assets would be divided among the rest of society. Among those who are honest, More honest (?), or at least have not been caught yet.
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BODYBAG
Dec. 20, 2012 at 10:31amBanks got their booty. Government fleeces them legally and gets their cut of the bounty.
What about all the average citizen’s who were swindled out of untold billions?
Left out in the cold once again?
Our government is a syndicate and banks are the enforcers. They’re a partnership.
The Federal Reserve lubes them both up.
All you have to do is bend over.
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Cavallo
Dec. 20, 2012 at 12:21pmWe (Citizens) don’t get any lube for that.
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Bonnieblue2A
Dec. 20, 2012 at 10:29amObviously global government sees it as a more egrigeous crime to launder money from Mexican drug cartels than to illegally traffik firearms and grenades like the Obama/Holder DOJ & BATFE did.
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Cavallo
Dec. 20, 2012 at 12:24pmIts different when The State does it. Private entities are not allowed to do the things Government is allowed to get away with.
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The-Monk
Dec. 20, 2012 at 10:29amAnd where does that money go to? Whose bank accounts? Toyota or Honda just paid the US a lorge fine. Where did that money go?
I hear a lot about fines but, hardly ever where the money goes…..
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barber2
Dec. 20, 2012 at 10:36amTHAT, Monk, is an interesting question.
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AbrahamsSheepdog
Dec. 20, 2012 at 10:45amJust thinking the same thing.
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Goldi-lox
Dec. 21, 2012 at 1:17amYeah, great question!
The dishonest, greedy bank ba tards ought to have to fork over the $$$ to their Depositors who are making something like .03 per cent interest on their deposited funds, while the filthy-rich, money-grubbing banksters are living it up and grabbing for even more “gusto.”
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resme
Dec. 21, 2012 at 3:36amJoe biden’s teeth
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barber2
Dec. 20, 2012 at 10:24amInteresting how the international Left and the Obama DOJ target banks. Haven’t heard much about targeting drug rings. Other than loosening some guns into that mix. Guess it’s one of those priority deals, and we know what the Left values in that area.
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BODYBAG
Dec. 20, 2012 at 10:37am@BARBER2
Posted on December 20, 2012 at 10:24am
Interesting how the international Left and the Obama DOJ target banks.
——————————————————–
This is simply public theatre. They’re partners, but they have to put on a “cops & robbers” public display to soothe the appearance of impropriety.
The Big Banks get free money so whatever the fine is, they pay it for show [bad bank --- wrist slap] then go right back to the money window and retract it again.
Its all a sham.
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AbrahamsSheepdog
Dec. 20, 2012 at 10:10amA damned rigged casino.
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momrules
Dec. 20, 2012 at 10:09amBoth the Colorado shooter and the Newtown shooter have A parent involved in the LIBOR scandal.
http://beforeitsnews.com/economics-and-politics/2012/12/2-mass-shootings-connected-to-libor-2447738.html
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UNALIEN
Dec. 20, 2012 at 10:19ambogus
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carpedeum
Dec. 20, 2012 at 3:54pmI have heard the same thing. Also, the shooter in Annetta, TX who shot and killed his sister and mom has a connection to this scandal. HIs dad works for the Federal Reserve and was in D.C. at the time he shot them. 10/4/12 We know the families of the shooters in Colorado (we know of them through other friends in San Diego) and Texas (our daughter went to school with the shooters sister). They are both quiet, church going families who are completely shocked by the behavior of their kids. Something is not right in all these situations.
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RJJinGadsden
Dec. 20, 2012 at 10:08amHmmmm, suppose this is why we haven’t seen any of those park bench related commercials on TV recently?
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RJJinGadsden
Dec. 20, 2012 at 10:33amI stand corrected. Wrong annoying commercials.
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IndyGuy
Dec. 20, 2012 at 9:59amNo problem…They have plenty of Americans hard earned money that Bush/Obama gave them to pay it off…
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naughtycal
Dec. 20, 2012 at 10:05amAll of HSBCs assets needs to be siezed and their ceo assets need to be seized as well along with anyone lese involved with laudrying bloodmoney….MAKE EXAMPLES OUT OF THEM
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Bloody Sam
Dec. 20, 2012 at 10:45amSo…to whom does this 1.5 billion go to? To whom does HSBC’s 2 billion dollar fine go to?
To the people who eventually got screwed over by this rate fixing? Yah. Right.
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UNALIEN
Dec. 20, 2012 at 11:21amHSBC got 3.5 million in bailout money,, paid 2 billion in fines,,
UBS got 5.3 billion in bailout money, paid 1.5 billion in fines
So, the taxpayers are effectively paying their fines or as we say socialize the losses and privatize the gains
But those in the business know that Central Banks had to be in on the LIBOR fixing…
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