Euro Parliament & Commission to make interest rate fixing a criminal offence
Vice Chair of the European Parliament’s Economic & Monetary Affairs Committee and draftsperson on the new European wide market abuse rules, Local Labour Euro MP, Arlene McCarthy, following her campaign for criminal prosecutions today welcomed proposals from the European Commissioner Michel Barnier to toughen up the Market Abuse Regulation (MAR) to penalise individuals involved in rate fixing scandals like Libor and Euribor.
Ms McCarthy said: “The European Parliament and Commission have moved swiftly in response to the public outrage against yet another abusive practice by rogue bankers, to strengthen the Market Abuse Legislation and to make rate fixing a criminal offence”.
Arlene McCarthy who has led calls for a full hearing of the European Parliament’s Economic and Monetary Affairs Committee (ECON) to grill banking chiefs over this manipulation and the apparent failure of national regulators added: “During my recent visit to the US I met with the US Commodity Futures Trading Commission (CFTC) and we exchanged ideas on how we can toughen up our rules on this abuse. This is an international problem and we need to ensure we set tough rules in both the US and EU.”
“LIBOR alone is used to set an estimated $800 trillion-worth of financial instruments. We are now seeing the Department of Justice in the US moving ahead with criminal prosecutions and we have seen small businesses seeking legal advice to get compensation for manipulation of interest rates.”
Ms McCarthy added: “I welcome Commission Barnier’s tough stance in his proposals today. The EU cannot be seen to be the soft option or a safe haven for what is clearly criminal behaviour.”
“We must ensure we have a robust legal and regulatory framework to prevent future manipulation or abuse and its potentially devastating consequences for the European and Global economy. Without this we will not end the continued crisis of confidence in banks and financial markets.”
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