The New York Daily News on the Barclays bank fraud probe:
Barclays, the British bank, forced out its chairman and paid $450 million in connection with a fraud investigation. This is a very big deal because, in all likelihood, you were a victim.
While financial scams have taken a toll on the economy, they have often been sharks-ate-sharks affairs. When a Goldman Sachs rigs up trading in mortgage securities, one rich guy gets richer and one gets poorer. When a J.P. Morgan loses, oh, $9 billion in trading, shareholders take the hit.
Barclays helped nick virtually everyone who has a credit card, mortgage or student loan. That's because interest rates on these loans are pegged to the London Interbank Offered Rate, or LIBOR.
LIBOR doesn't measure what any bank is paying in interest. It's what bankers say they expect they'd have to pay if they borrowed money in order to lend it out to consumers. At Barclays, they fibbed about the numbers to get an edge in sophisticated trading - and distorted just a little bit the rate you paid on your loans.
Hang 'em high.
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