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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsSwaps Probe Finds Banks Manipulated Rate at Expense of Retirees
http://www.bloomberg.com/news/2013-08-02/swaps-probe-finds-banks-manipulated-rate-at-expense-of-retirees.htmlU.S. investigators have uncovered evidence that banks reaped millions of dollars in trading profits at the expense of companies and pension funds by manipulating a benchmark for interest-rate derivatives.
Recorded telephone calls and e-mails reviewed by the Commodity Futures Trading Commission show that traders at Wall Street banks instructed ICAP Plc brokers in Jersey City, New Jersey, to buy or sell as many interest-rate swaps as necessary to move the benchmark rate, known as ISDAfix, to a predetermined level, according to a person with knowledge of the matter.
By rigging the measure, the banks stood to profit on separate derivatives trades they had with clients who were seeking to hedge against moves in interest rates. Banks sought to change the value of the swaps because the ISDAfix rate sets prices for the other derivatives, which are used by firms from the California Public Employees Retirement System to Pacific Investment Management Co., said the person, who asked not to be identified because the details arent public.
That may run afoul of the 2010 Dodd-Frank Act, which bars traders from intentionally interfering with the orderly execution of transactions that determine settlement prices.
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Swaps Probe Finds Banks Manipulated Rate at Expense of Retirees (Original Post)
xchrom
Aug 2013
OP
Laurian
(2,593 posts)1. F**king bankers are despicable. I believe they'd steal from their own
mothers if it would gain them a dime.
When will they be held accountable? When hell freezes over?
xchrom
(108,903 posts)2. stealing from their mothers is probably how they get started in the business. nt
frylock
(34,825 posts)3. these guys are heroes to assholes like chuck schumer