The Libor Swindle: Systematic Financial Rigging of the Benchmark Global Interest Rate

The latest sweetheart settlement with a major international bank, in this case involving criminal activities that financial regulators describe as “epic,” has once again lifted the lid on the cesspool of corruption otherwise known as the world financial system.

UBS, Switzerland’s largest bank, admitted this week to systematically rigging the London Interbank Offered Rate (Libor), the benchmark global interest rate to which hundreds of trillions of dollars of financial contracts are tied. It did so to increase its profits and conceal its financial problems.

UBS’s actions defrauded hundreds of millions of people who pay interest on mortgages, credit cards, student loans and car loans, as well as institutional investors such as pension funds and state and local governments, and countless millions of retirees who rely for income on fixed investments. The term grand larceny does not begin to describe the scale of this plunder.