Appeals court docket revives Libor manipulation claims in opposition to banks – Enterprise Insurance

(Reuters) – A U.S. appeals court on Thursday revived a lawsuit accusing a number of large banks of conspiracy to manipulate the Libor rate, including during the 2008 financial crisis, to grow profits at the expense of investors To make banks appear healthier than they were.

The 2nd Manhattan appeals court said a lower court judge had antitrust claims from investors, including Charles Schwab Corp., which bought various Libor-based products from banks or bought Libor-based futures on the Chicago Mercantile Exchange to have.

Without ruling on the matter, District Judge Richard Sullivan said the allegations that bank executives and executives in the United States ordered the suppression of Libor were the jurisdiction under a conspiracy-based liability theory.

The appeals court accepted this theory after U.S. District Judge Naomi Reice Buchwald dismissed investor claims in Manhattan in 23 separate cases from the ten-year-old litigation.

Thursday's 43-page ruling by a three-judge panel revived many of those claims, and the appeals court returned these cases to Judge Buchwald for further processing.

The defendant banks sat on a committee that was involved in setting the Libor.

These included Bank of America, Bank of Tokyo-Mitsubishi UFJ, Barclays, Citigroup, Credit Suisse, Deutsche Bank, HSBC, JPMorgan Chase, Lloyds Banking Group, NatWest, Norinchukin Bank, Rabobank, Royal Bank of Canada, Societe Generale, UBS and WestLB .

Lawyers who represented the banks and investors at the oral hearings in May 2019 did not immediately respond to requests for comment.

Libor, or the London Interbank Offered Rate, has supported hundreds of trillion dollars in transactions, including $ 265 trillion in early 2021.

It was used to set interest rates on things like credit cards, student loans, and mortgages.

The benchmark will be abolished on January 1, 2022 in the wake of interest rate manipulation that resulted in fines for several banks.

It will be replaced by alternative tariffs, preferably those recommended by several banks and based on actual transactions.

The case is In re Libor-Based Financial Instruments Antitrust Litigation, 2nd U.S. Circuit Court of Appeals.

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