Home Herring joins $100 million settlement with Barclays: LIBOR

Herring joins $100 million settlement with Barclays: LIBOR


economic-forecast-headerAttorney General Mark R. Herring today announced that Virginia is part of a $100 million settlement with Barclays Bank PLC and Barclays Capital Inc. for fraudulent and anticompetitive conduct involving the manipulation of LIBOR, a benchmark interest rate that affects financial instruments worth trillions of dollars and impacts a wide array of global markets and consumers.

Virginia state and local governments and non-profit organizations are expected to recover a total of approximately $1 million as part of the settlement.

“Investors have a right to rely on accurate, sound information when making financial and investment decisions that could have a real impact on retirement accounts and the bottom line of a Virginia government entity or nonprofit,” said Attorney General Herring. “Working with our colleagues across the country, we have been able to resolve these claims of illegal manipulation and provide some relief to those who suffered during the financial crisis.”

The investigation into Barclays, conducted by a multistate working group of 44 State Attorneys General, led by the Attorneys General of New York and Connecticut, revealed that Barclays manipulated LIBOR through two different kinds of fraudulent and anticompetitive conduct. First, during the financial crisis period of roughly 2007-2009, Barclays encouraged certain false reporting practices to keep its own reported borrowing rates low and avoid the appearance of financial difficulty. Second, at various times from 2005 to 2007 and continuing at least into 2009, Barclays’ traders encouraged certain reporting practices that benefited their own investments.

Government entities and not-for-profit organizations in Virginia and throughout the U.S., among others, were defrauded of millions of dollars when they entered into certain investments with Barclays without knowing that Barclays and other banks were manipulating LIBOR and colluding with one another.

Governmental and not-for-profit entities with certain affected investment contracts with Barclays will be notified if they are eligible to receive restitution from a settlement fund of $93.35 million. The balance of the settlement fund will be used to pay costs and expenses of the investigation and for other uses consistent with state law.

The states joining the Barclays settlement include: Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming.



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