The Royal Bank of Scotland Group has agreed to pay £390m ($612m/€451m) to settle US and UK charges related to the manipulation of the benchmark lending rate known as Libor, as well as pleading guilty to a criminal charge of wire fraud from a Japanese subsidiary.
In addition to the announcement, the US Commodity Futures Trading Commission (CFTC), Department of Justice and the UK's Financial Services Authority (FSA) unveiled transcripts of the Libor fixing misconduct that were committed between 2006 and 2010.
With false reporting, manipulation and attempted manipulation of the interbank lending rate that was denominated in yen and Swiss francs, the mass manipulation of Libor involved more than a dozen RBS derivatives and money market traders, said a CFTC statement published on its website.
Yen LIBOR Manipulative Conduct Within RBS:
August 20, 2007:
Yen Trader 4: where's young [Yen Trader 1] thinking of setting it?
Yen Trader 1: where would you like it[,] libor that is[,] same as yesterday is call
Yen Trader 4: haha, glad you clarified ! mixed feelings but mostly I'd like it all lower so the world starts to make a little more sense.
Senior Yen Trader: the whole HF [hedge fund] world will be kissing you instead of calling me if libor move lower
Yen Trader 1: ok, i will move the curve down[,] 1bp[,] maybe more[,] if I can
August 20, 2007: (Emphasis added [by CFTC statement].) (Reflecting awareness of UBS conduct.) (RBS Order pp. 14-15.)
Bank B Trader: [UBS] is lending dolls through my currencies in 3 month do u see him doing the same in urs
Senior Yen Trader: yes[,] he always led usd in my mkt[,] the jpy libor is a cartel now
Senior Yen Trader: its just amazing how libor fixing can make you that much money
Senior Yen Trader: its a cartel now in london[.] they smack all the 1yr irs ..and fix it very high or low
December 5, 2007:
Yen Trader 2: FYI libors higher again today
Yen Trader 4: 'ucksake. keep ours low if poss. don't understand why needs to go up in yen
Yen Trader 2: no reason dude[,] [Bank C] and [Bank D] went high yest
Yen Trader 4: send the boys round
Yen Manager: pure manipulation going on
April 2, 2008: Senior Yen Trader: nice libor[.] our 6m fixing move the entire fixing[.] hahahah
Yen Trader 1: the BBA called to ask me about that today
Senior Yen Trader: really?
Yen Trader 1: yes
Senior Yen Trader: they complain?
September 15, 2009:
Yen Trader 1: can we lower our fixings today please [Primary Submitter]
Primary Submitter: make your mind up[,] haha , yes no probs
Yen Trader 1: im like a whores drawers
Yen LIBOR Collusion With UBS:
February 15, 2007:
Yen Trader 2: how many people can u get to put this 1m libor low
UBS Yen Trader: well us[,] [Bank E,] and a few others i think
February 21, 2007:
Yen Trader 2: what ur guys calling 3s libor[?] we need to get some low fixes
UBS Yen Trader: .64[,] yes will ask for low low high[,] 1m 3m 6m
Yen Trader 2: our guy agrees but reckons it will be 67[,] not good
UBS Yen Trader: no way!
UBS Yen Trader: [...] make sure your boys set low 1m and 3m
Yen Trader 2: will try though [Yen Trader 1/backup Yen LIBOR submitter] wants high 3s and 6s
UBS Yen Trader: we want high 6's too? don't let [Yen Trader 1] keep 3m high to help [Senior Yen Trader][,] i hate that guy
May 7, 2008:
UBS Yen Trader: Hi [Sterling Cash Trader] if this is you can you pls ask for a low 6m in jpy for the next few days[.] Hope you are ok, was good seeing you last week[.] Cheers [UBS Yen Trader]
Sterling Cash Trader: Hi mate, I mentioned it to our guy on Friday and he seemed to have no problem with it, so fingers crossed.
Swiss Franc LIBOR Manipulative Conduct Within RBS:
December 4, 2008: (Emphasis added.) (RBS Order p. 25-26.)
Swiss Franc Trader: can u put 6m swiss libor in low pls?
Primary Submitter: NO
Swiss Franc Trader: should have pushed the door harder
Primary Submitter: Whats it worth
Swiss Franc Trader: ive got some sushi rolls from yesterday?
January 30, 2009:
Primary Submitter: libors as requested
Swiss Franc Trader: you a top dog
May 5, 2009:
Swiss Franc Trader: can we get high 3m, low 6m pls!
Primary Submitter: maybe
Swiss Franc Trader: PPPPLLLLLEEEEEAAAAASSSSEEEEEE
Primary Submitter: ok 41 52
Swiss Franc Trader: perfect perfect
May 14, 2009:
Swiss Franc Trader: [Primary Submitter] pls can we get super high 3m[,] super low 6m
Swiss Franc Trader: PRETTY PLEASE!
Primary Submitter: 41 & 51
Swiss Franc Trader: if u did that[,] i would lvoe [sic] u forever
Primary Submitter: 41 & 55 then ...
Swiss Franc Trader: if u did that i would come over there and make love to you[,] your choice
Primary Submitter: 41+51 it is
Swiss Franc Trader: thouht [sic] so
Primary Submitter: so shallow
RBS Collusion With Interdealer Brokers:
June 26, 2009: (Interdealer Broker B: Hello mate, [Yen Trader 1]? You all set?
Yen Trader 1: Yeah.
Interdealer Broker B: Right listen we've had a couple of words with them, you want them lower right?
Yen Trader 1: Yeah.
Interdealer Broker B: Alright okay, alright listen, we've had a couple words with them. You want them lower, right?
Yen Trader 1: Yeah.
Interdealer Broker B: Alright okay, alright, no we're okay just confirming it. We've, so far we've spoke to [Bank F]. We've spoke to a couple of people so we'll see where they come in alright. We've spoke, basically one second, basically we spoke to [Bank F], [Bank G], [Bank H], who else did I speak to? [Bank I]. There's a couple of other people that the boys have spoke to but as a team we've basically said we want a bit lower so we'll see where they come in alright?
Yen Trader 1: Cheers.
Interdealer Broker B: Cheers no worries mate.
RBS Yen Trader Engaged In Wash Trades to Compensate Brokers
September 19, 2008:
Interdealer Broker B: can you do me a favour ... you're not going to get paid any bro for this and we'll send you lunch around for the whole desk. Can you flat...can you switch two years semi at 5 3/4 , 100 yards [meaning 100 billion] ... between UBS. Just get ... take it from UBS, give it back to UBS. He wants to pay some bro. We won't bro you...
Yen Trader 1: Yeah, yeah
Interdealer Broker B: Yeah. Yeah. 100 yards ... actually can you make it 150 and I'll send lunch around for everybody?
Yen Trader 1: Yeah.
Interdealer Broker B: Thanks very much. Cheers. Cheers, mate and you choose lunch.