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Seven banks agree to pay $324m to settle rate rigging lawsuit

BBR Staff Writer Published 06 May 2016

Seven major banks have agreed to pay $324m to settle a lawsuit that accused them of manipulating of interest rate benchmark in the derivative market.

However, the settlement is subject to court's approval.

The seven banks that are ready for a settlement include Bank of America, Barclays, Citigroup, Credit Suisse, Deutsche Bank, JPMorgan Chase and Royal Bank of Scotland (RBS).

The settlement includes a payment of $52mby JP Morgan, $42m by Citigroup, $30m by Barclays, and $50m each by Bank of America, Credit Suisse, Deutsche Bank and RBS.

The lawsuit, which has been filed by several pension funds and municipalities in the US, alleged manipulation of ISDAfix rate by 14 banks to earn profits. It stated the banks rigged interest rates from at least 2009 to 2012, Reuters reported.

BNP Paribas, Goldman Sachs, HSBC, Morgan Stanley, Nomura Holdings, UBS, Wells Fargo and ICAP are the other banks facing the lawsuit.

The settlement was announced by the seven banks a month after the US District Judge Jesse Furman in Manhattan declined to dismiss the lawsuit.

David Scott, a lawyer for the plaintiffs was quoted by AFP as saying:"We are very pleased that these banks are offering our clients hundreds of millions of dollars in recovery." "We will continue to vigorously pursue relief from the remaining defendants, substantially aided by the cooperation we secured in these settlements."