U.S. Congress conducting rate-fixing inquiries

Martin Crutsinger / The Associated Press /


Published Jul 11, 2012 at 05:00AM / Updated Nov 19, 2013 at 12:31AM

WASHINGTON — Two congressional committees are raising questions about what U.S. regulators knew concerning allegations that a key global interest rate was being manipulated.

The chairman of a House Financial Services oversight subcommittee has asked the Federal Reserve Bank of New York to provide transcripts of discussions between Fed officials and the British bank Barclays regarding the setting of interest rates from September 2007 to November 2009. The New York Fed said it would comply with the request.

Meanwhile, Senate Banking Committee Chairman Tim Johnson said Tuesday that he is also concerned about the allegations and has asked staffers to begin gathering information.

Barclays has been fined $453 million by U.S. and British authorities for supplying false data which went into calculations of the London interbank offered rate, LIBOR, a key global interest rate.

In a statement, Johnson, a Democrat from South Dakota, said that he had asked the staff of the Senate panel to meet with relevant parties to gather information.

He said he was asking Federal Reserve Chairman Ben Bernanke and Treasury Secretary Timothy Geithner to be prepared to answer questions about LIBOR when they appear before his committee at hearings later this month.

“I am concerned by the growing allegations of potential widespread manipulation of LIBOR and similar interbank rates by some financial firms,” Johnson said. “It is important that we understand how any manipulation may impact American consumers and the U.S. financial system.”