Lloyds To Pay $370.5 Million In Latest Rate Manipulation Settlement

Lloyds Banking Group

agreed to pay $370.5 million Monday to settle rate manipulation allegations with U.K. and U.S. authorities. Lloyds opened sharply lower Monday and traded recently at $5.11, down more than 1 percent. Manipulations began in May 2006 and continued until 2009 and concerned the London interbank offered rate, or Libor, as well the so-called Repo Rate used by the Bank of England in an emergency lending program in the 2008 financial crisis. Sixteen individuals at Lloyds, including seven managers, were directly involved in, or aware of Libor manipulation, including one manager who was also involved in the Repo Rate manipulation, according to Britain's Financial Control Authority. LLoyds said those individuals were either fired, suspended or disciplined. Terms of the deal require Lloyds to pay $59.5 million to Britain's Financial Control Authority; $107.1 million to the U.S. Commodities Futures Trading Commission and $86.7 million to the U.S. Department of Justice. Llyods also signed a two-year agreement with the Department of Justice in which a charge of wire fraud will be dropped if conditions are met. Lloyds will also pay the Financial Control Authority $119 million to resolve allegations it manipulated the British Bankers' Association Repo Rate. Lloyds separetely has paid the Bank of England $13.2 million in compensation over the Repo Rate manipulation. Other banks and brokers have signed similar settlements, including Barclays, Royal Bank of Scotland, ICAP Europe Ltd., Rabobank and Martin Brokers Ltd.