Home » Fraud updates » Major global bank guilty of fraud

Major global bank guilty of fraud

This week, UBS became the first global bank in over two decades to have a subsidiary pleading guilty to fraud in the US. UBS announced that its Japanese subsidiary would plead guilty to one count of felony wire fraud as part of a wider settlement deal with the US authorities over its manipulation of Libor rates.

UBS has been fined £940 million by British, American and Swiss regulators including the biggest-ever fine given by the FSA of £160m. The US Justice Department also filed criminal charges against two former UBS traders.

It is claimed that all of the major banks that were involved in the setting of Libor are being investigated, and more fines are likely to follow. In the US, lawsuits have been launched by US municipalities, pension funds and hedge funds.

Victims of these activities may also be entitled to compensation for the losses they have sustained. For example, in the UK, a High Court Judge recently held that a victim of Libor rigging is entitled to claim damages in relation to alleged attempted Libor-rigging and the mis-selling of hedging products by a major bank. The case is set to go to trial next year.