Barclays PLC and its subsidiaries have agreed to pay more than $450 million to settle charges that it attempted to manipulate and made false reports related to setting key global interest rates.
The rates indirectly affect the costs of hundreds of trillions of dollars in loans that people pay when they get loans to go to school, purchase a car or buy a house.
Britain's Barclays was just one of numerous major banks reportedly under investigation for similar violations.
The U.S. Commodity Futures Trading Commission said Wednesday that the incidents occurred between 2005 and 2009 and sometimes took place daily. The $200 million civil penalty levied against Barclays as part of the settlement is the largest in the agency's history.
Barclays is also paying $160 million to the U.S. Justice Department and almost $93 million to British regulators.
The CFTC said Barclays senior management and multiple traders were involved in the matter and that they also coordinated with traders at other banks to make false submissions. The data was used in determining the London interbank offered rate – known as LIBOR_ and Euribor rates, which influence many other interest rates.
"Banks must not attempt to influence LIBOR or other indices based upon concerns about their reputation or the profitability of their trading positions," CFTC Chairman Gary Gensler said in a statement.
The LIBOR is an average rate set by banks each morning that measures how much they're going to charge each other for loans. That in turn affects the costs consumers pay for loans and investments.
Barclays also agreed to pay $160 million as part of an agreement with the fraud section of the Justice Department's criminal division on a related matter. The Justice Department said its related criminal investigation continues, and Barclays agreed to cooperate with that probe as part of its settlement.
Assistant Attorney General Lanny Breuer said that Barclays was the first bank to cooperate extensively with the investigation. Barclay's cooperation greatly helped the Justice Department in the probe, he said.
Britain's Financial Services Authority levied a fine of 59.5 million pounds ($92.7 million), the biggest fine ever imposed by the British regulator.
"Barclays' misconduct was serious, widespread and extended over a number of years," Tracey McDermott, acting director of enforcement and financial crime at the British agency, said in a statement. "The integrity of benchmark reference rates ... is of fundamental importance to both U.K. and international financial markets. Firms making submissions must not use those submissions as tools to promote their own interests."
Barclays President Bob Diamond also announced he and three senior bank executives were waiving any bonus for the year as a result of the case.
The other executives include Group Finance Director Chris Lucas, Chief Operating Officer Jerry del Missier and Chief Executive of Corporate and Investment Banking Rich Ricci.