* Trader Chong Wen Kuang suspended earlier in year - source
* Suspension broadens scope of Libor investigation
* RBS said in August it had dismissed staff
LONDON, Oct 5 (Reuters) - Royal Bank of Scotland has suspended a trader for attempting to manipulate a reference lending rate in Singapore, a person familiar with the matter told Reuters, showing the global spread of the scandal over setting rates such as Libor.
The part-nationalised UK bank put senior trader Chong Wen Kuang on leave earlier this year, the source said, for trying to manipulate the Singapore dollar swap offer rate (SOR).
Chong is the first trader known to have been suspended by RBS in relation to a rate other than Libor, widening the breadth of the lender's possible exposure to the global interest-rate rigging affair.
RBS declined to comment. Chong could not be reached for comment.
RBS said in August it had dismissed staff following an internal investigation into the setting of Libor and other interest rates. But did not give any further details of the individuals concerned or where they were based.
Barclays was the first bank to settle over the issue, paying record fines totaling 290 million pounds ($468.8 million) in June following investigations by U.S. and UK authorities.
Some analysts believe RBS could face an even greater punishment and several other banks could also be affected.
Reuters reported in July that RBS and Switzerland's UBS were two of the banks that had played a central role in the manipulation of rates.
RBS, which is 82 percent owned by the government following a bailout in 2008, likely wants to settle the matter quickly, partly to remove a threat to the value of Britain's stake in the bank. Taxpayers are sitting on a loss of 21.6 billion pounds after Britain pumped in 45 billion to rescue the bank.
Chief Executive Stephen Hester, who this week described RBS as a "British poster child for what went wrong in banking", has said RBS will "stand up and take any punishment" that comes its way following the Libor investigations.
RBS has said it is co-operating with governments and regulators in the United States, Britain and Japan and with competition authorities in Europe, the United States and Canada.
Singapore's central bank in July ordered banks in the city-state to review the way benchmark interbank borrowing rates are set, as regulators worldwide scrutinise the troubled system.
Ex-RBS trader Tan Chi Min has alleged in court papers that the bank's head of compliance Sim Suh-Ting had sent an email to senior manager saying it was acceptable for traders to make requests about the level at which the swap-offer rate was set.
Also on HuffPost:
Barclays Begins Manipulating Libor Rate
Barclays allegedly began manipulating the Libor rate in 2005 and allegedly stopped manipulating Libor in 2009, <a href="http://www.businessweek.com/news/2012-07-11/barclays-u-dot-s-dot-say-libor-probe-doesn-t-affect-2010-case" target="_hplink">according to <em>Businessweek</em>.</a> But other reports indicate that <a href="http://www.huffingtonpost.com/2012/07/09/libor-scandal-manipulation-spanned-decades_n_1658696.html" target="_hplink">Libor fixing may have spanned decades.</a>
Barclays Employee Admits Libor Is Being Rigged
A Barclays employee told an analyst from the New York Fed's Markets Group that Barclays was indeed using false information to set the interest rate on April 11, 2008, according to <a href="http://www.huffingtonpost.com/2012/07/13/geithner-libor_n_1671211.html" target="_hplink">recently released Federal Reserve documents</a>. "We know that we're not posting, um, an honest LIBOR," the Barclays employee told the New York Fed's Fabiola Ravazzolo, according to a <a href="http://www.newyorkfed.org/newsevents/news/markets/2012/libor/April_11_2008_transcript.pdf" target="_hplink">transcript of the phone conversation.</a>
Geithner Privately Expresses Concern Over Libor's Integrity
In June 2008, then-president of the New York Federal Reserve Timothy Geithner sent a memo to British banking authorities expressing concern over the "integrity and transparency" of the key interest rate. Geithner did not inform British regulators that a Barclays employee admitted that Libor was being rigged, <a href="http://in.reuters.com/article/2012/07/25/geithner-libor-idINL4E8IP17720120725" target="_hplink">according to Reuters.</a>
Banks Ripped Off The Government During Bailout
During the 2008 Financial Crisis, the U.S. government lent money to cash strapped banks and AIG using Libor to determine interest, <a href="http://www.huffingtonpost.com/mark-gongloff/timothy-geithner-libor_b_1701904.html" target="_hplink">Treasury Secretary Tim Geithner told Congress on July 25, 2012.</a> The artificially low rate saved the banks and AIG billions, while costing tax payers the same amount.
Peter Mandelson: Barclays CEO The "Unacceptable Face Of Banking"
In April 2010, then-UK Business Secretary Peter Mandelson told the<em>Times of London</em> that then-CEO of Barclays, Robert Diamond, was "the unacceptable face of banking" after the bank announced that its CEO would receive a bonus of 63 million pounds, <a href="http://news.sky.com/story/771318/mandelson-attacks-bank-boss-for-63m-salary" target="_hplink">Sky News reports.</a> Mandelson also told <em>the Times</em> that banking bosses were expected to act with "a bit more modesty, a bit more humility" than Diamond's behavior.
Barclays Fined $450 Million
On June 27, Barclays disclosed to its shareholders that it would be fined $450 million by U.S. and U.K. regulators for conspiring to manipulate the Libor rate between 2005 and 2009, <a href="http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9374118/Barclays-libor-fixing-scandal-timeline.html" target="_hplink"><em>The Telegraph</em> reports</a>.
Barclays Chairman Resigns
On July 2, <a href="http://group.barclays.com/news/news-article/1329925915887/navigation-1330349038798" target="_hplink">Barclays announced</a> that it's Chairman, Marcus Agius, would be resigning in the wake of the Libor rigging scandal. In the official resignation letter, Mr. Agius stated that the Libor rigging constituted "unacceptable standards of behaviour within the bank." He went on to say: <blockquote>As Chairman, I am the ultimate guardian of the bank's reputation. Accordingly, the buck stops with me and I must acknowledge responsibility by standing aside."</blockquote>
Robert Diamond Resigns As Barclays CEO
On July 3, Robert Diamond resigned as Barclays CEO, <a href="http://www.washingtonpost.com/business/barclays-boss-diamond-quits-with-immediate-effect-latest-scalp-of-price-fixing-scandal/2012/07/03/gJQAFeDxJW_story.html" target="_hplink"><em>The Washington Post</em> reports.</a>
Marcus Agius Re-Appointed As Barclays Chairman
On July 3, <a href="http://www.newsroom.barclays.com/Press-releases/Board-changes-907.aspx" target="_hplink">Barclays announced</a> that Marcus Agius would be reappointed as the bank's full-time Chairman following the resignation of Robert Diamond.
Did The Bank of England Encourage Barclays?
On July 3, Barclays released phone records between CEO Robert Diamond and the Deputy Governor of the Bank of England, Paul Tucker, that indicate that the BoE executive encouraged Barclays to manipulate the Libor rate, <a href="http://online.wsj.com/article/SB10001424052702304141204577506602345146644.html" target="_hplink"><em>The Wall Street Journal </em>reported.</a>
Diamond Goes Before Parliament
On July 4, Bob Diamond told a U.K. parliamentary panel that he believes other major banks were involved in Libor rigging, <a href="http://online.wsj.com/article/SB10001424052702304141204577506602345146644.html" target="_hplink"><em>The Wall Street Journal</em> reports.</a> He also stated that fear of being nationalized during the 2008 Financial Crisis contributed to its actions.
Bob Diamond Loses His $31 Million Bonus
Barclays CEO Bob Diamond agreed to forgo an extra $31 million bonus, the bank announced on July 10, according to the <a href="http://online.wsj.com/article/SB10001424052702303343404577518263465180508.html" target="_hplink">reports <em> Wall Street Journal</em>.</a> Diamond will still net his salary and pension for a year, which is worth about 2 million pounds.
At Least 16 Banks Under Investigation
At least 16 banks were reportedly under investigation for Libor rigging as of July 11, <a href="http://www.huffingtonpost.com/2012/07/11/libor-rate-scandal_n_1664737.html#slide=1212066" target="_hplink">according to Reuters.</a> In an internal bank memo circulated on July 13, Barclays executive committee told employees that, "As other banks settle with authorities, and their details become public, and various governments' inquiries shed more light, our situation will eventually be put in perspective," <a href="http://business.time.com/2012/07/16/libor-rigging-what-the-regulators-saw-but-didnt-shut-down/" target="_hplink"><em>TIME Magazine</em> reports.</a>
EU Weighs Criminalizing Rate Rigging
On July 25, <a href="http://www.huffingtonpost.com/2012/07/25/eu-criminalizing-rate-rigging_n_1701248.html?utm_hp_ref=business" target="_hplink">the European Union proposed making the rigging of international interest rates a criminal offense.</a>