Morning Coffee: Another Rate Manipulation Scandal Brewing
Get ready to pronounce another awkwardly-worded acronym. At least a dozen banks are reportedly being investigated for colluding to manipulate Euribor, the euro interbank offered rate, a close relative of Libor, according to The Wall Street Journal.
At the forefront of the investigation is, yet again, Barclays, which, beginning in 2005, allegedly manipulated the rate to help generate profits for its trading businesses. Barclays traders coordinated their efforts with at least four other banks that have yet to be publicly identified. However, sources told the Journal that Credit Agricole, Société Générale, HSBC and Deutsche Bank are being investigated.
Judging by internal Barclays emails obtained by the Journal, the manipulation of Euribor was as flagrant and brazen as was the case with the Libor scandal.
While the investigation is still ongoing, the potential fallout can be easily imagined. The Libor scandal forced Barclays to completely retool its upper management, including replacing former chief executive Bob Diamond with retail and business banking boss Antony Jenkins, and fire dozens of traders. Other banks embroiled in the scandal have been suspending and firing traders on nearly a daily basis.
A source recently told Financial Times that “even people who had simply been copied in on emails” related to Libor manipulation were let go.
And now we have another mess on our hands.
Bank of America, J.P. Morgan Chase, Deutsche Bank and other firms plan to move thousands of jobs out of London.
Large accounting firms are becoming less vigilant in auditing the effectiveness of their clients’ internal controls, increasing the probability of failing to identify financial error or fraud.
Standard Chartered has agreed to pay an additional $327 million to settle allegations that it hid billions worth of transactions with the Iranians. The U.K. firm said last week that it remains "firmly in growth mode” despite the allegations.
Roughly 65% of women appointed to board positions have a finance background, compared to just 44% of men.
U.K.-based Global Investors and Germany’s Union Investment will each cut roughly 10% of their staff.
More than 2,000 current and former J.P. Morgan employees may be required to contribute to an $800 million settlement with the U.K. government over back taxes.
Former International Monetary Fund chief Dominique Strauss-Kahn has reached a financial settlement with the hotel maid who accused him of rape.
Man Group COO Emmanuel Roman will succeed chief executive Peter Clarke when he retires in February. The hedge fund has seen a huge drop in assets under management over the last two years.
Buzz Around the Office
A Michigan man attempted to pull over a police officer who wasn’t wearing a seatbelt. The move resulted in charges of reckless driving for the concerned citizen.
List of the Day: Layoff Rumors
If you are hearing rumors of potential layoffs, it’s best to be prepared for the worst.
- Transfer your work contacts to a personal device.
- Know what benefits you’re entitled to.
- Get your resume ready, and get it out the door.