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UBS Admits to Fraud

Thursday, December 20, 2012

UBS building in New York (Allie Caulfield/flickr)

UBS has pled guilty to manipulating global interest rates, and will pay $1.5billion in fines. Liam Vaughan, Bloomberg UK finance reporter, discusses the case and the implications for financial regulation.

Guests:

Liam Vaughan

Comments [5]

Eugenia Renskoff from Brooklyn, NY

Hi, No one should make a profit out of the people who put up the money--as in borrowers--to buy a house. Or the people paying the mortgage every month. When will someone in the banking industry go to jail? Eugenia Renskoff

Dec. 20 2012 04:58 PM
Chris from New York

LIBOR rates did not add at all to the mortgage bubble problem. The widespread subsidies by the federal government to the housing sector (low interest rates, mortgage interest deductability) were just as large a cause as Wall Street. They were manipulating rates by 0.001%. Small bites of an enormous pie.

I used to work at UBS in an "insider" type position. The bank is a basically an aggregation of hundreds of small businesses with their own financial accounts and senior management has little idea of what's really going on. Managing the behavior of traders at enormous financial institutions is incredibly difficult.

The general lack of ethics at the bank and the frequent scandals is why I quit working there.

Dec. 20 2012 11:53 AM

Informative? Not so much.

How was the LOBOR "interest setting paradigm" different from the "immoral" practice of "lending money for interest" that was condemned by several major religious faiths?

Dec. 20 2012 10:29 AM
RUCB_Alum from Central New Jersey

Same story as Enron...Why do we ever expect an unregulated trader to act in anything other than their own best interest? Shame on us. Tax their trading sufficiently in order to establish valid and continuing auditing practices.

Question 2: To what degree did cooked LIBOR rates add to the mortgage bubble problem?

Dec. 20 2012 10:15 AM

No one will go to jail...they pay a fine that is 2 months of profits. they made many more billions over the years doing the crimes.

Dec. 20 2012 10:15 AM

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