Bluree li es4/26/2023 In a further lawsuit brought by Property Alliance Group against RBS relating to swaps for damages of £30m, RBS has been ordered to handover documents setting out its negotiations with the FCA over its £390m fine for Libor manipulation and which are also kept confidential under seal as a condition of its DPA with US regulators. This is separate to the $2.43bn of fines Barclays received for allegedly rigging Forex and Isdafix benchmarks. It has also alleged the bank engaged in anti-competitive behaviour by colluding with other banks to manipulate Libor. Similarly, and having been fined £290m by UK and US authorities in relation to Libor fixing, Barclays is defending a £50m damages claim brought by its customer Rhino Enterprises, which claims false Libor submissions undermined various swap arrangements which triggered administration. The courts have compared the case to a diner sitting down at a restaurant who makes an implied representation that he or she can pay for their meal – a reasonable person in either scenario would not infer or suspect dishonesty. In the wake of regulatory sanction, it was able to successfully amend its claim to allege that the bank impliedly represented that it would not falsely or fraudulently manipulate the benchmark. Unitech Global is pursuing Deutsche Bank for damages, and resisting enforcement of $150m of loans, relating to the alleged mis-sale of interest rate swaps linked to Libor. This is all grist to the mill for civil claims being played out in the High Court. The two joint Chief Executives of the Bank are also to stand down. The FCA said that the Bank repeatedly misled it during Libor investigations, took too long to produce relevant documents and was slow to fix inadequate systems and control which contributed to an enhanced fine. It received a record $2.5bn of fines following an admission of guilt under a deferred prosecution agreement (DPA) with US authorities relating to alleged Libor rigging. If so, do you categorise and volunteer all relevant emails and data, in a timely fashion instead of opting for a ‘document dump’? Co-operating with the regulator means claimants will more easily be able to find and identify the most sensitive evidence and courts will decide if an attempted selective waiver of legal privilege is effective.ĭeutsche Bank is a case in point. Do you turn yourself in to the regulator and self-report in return for a lower fine and immunity? The price to pay for public acknowledgment of wrongdoing might be increased levels of civil claims. This throws up a number of difficult issues to navigate. Since 2010, the volume of requests from the US Securities Exchange Commission (SEC) for co-operation from foreign regulators has increased by 59% and the volume of requests received by the Financial Conduct Authority (FCA) from foreign regulators has increased by 36%. Risk management is made more complex by the fact investigations can emanate from overseas regulators across jurisdictions – particularly the US. Therefore, what is good strategy on the one hand may not be good strategy on the other. In addition to large fines, civil claims may also be launched off the back of public criticism from a regulator in the knowledge that whistle-blowers or sensitive documents from the investigation already exist. Regulatory investigations are an increasingly common part of corporate life, particularly in the financial services sector.
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