Mark Gongloff, Huffington Post
So far Barclays has been the sad, British face of the Libor scandal, but there could soon come a day when an American bank could be the poster child for Libor manipulation. USA! USA!
Fortune’s Stephen Gandel wrote on Friday about not one, not two, but three different studies that use charts and math to show that, of all the many banks just stone-cold manipulatin’ Libor during the financial crisis, the champion Libor-mangler of all was apparently, drumroll please, Citigroup.
Citi did not respond to Fortune’s request for a comment. It is no doubt one of 16 different banks, including fellow Americans Bank of America and JPMorgan Chase, getting the stinkeye from regulators over Libor.
Libor, for you Libor virgins who have somehow accidentally stumbled into this story, is an interest rate at which banks lend money to each other for short periods. It’s the basis for hundreds of trillions of dollars’ worth of loans and derivative contracts. Kind of a big deal, then.
The funny thing about this super-important rate is that it is almost completely bullshit. The banks who set Libor are on an honor system to report their borrowing costs, so you can see where this is going. Barclays was accused of manipulating Libor up and down, sometimes to help its traders make more money, other times to make its financial condition look healthier. Other banks are under investigation for allegedly having a cartel of Libor manipulators, helping each other make money on trades.