The U.K. will be expanding its scope of laws and policies which will criminalise the market benchmarks shall include seven additional rates to cover the currency gold, oil and silver markets by April 1, 2015.
The contemplated move is the most recent conservative-led government to secure the malpractice in the city of London whose character has been tainted by an interest rate-rigging scandal and claims that traders made extraordinary arrangements to manipulate currency rates.
In order to make sure that the key rates that are underpinning the financial markets here and around the world are vibrant and that for anyone who are seeking to alter them shall be subject to the full force and effect of the law is regarded as an essential part of the long-term economic plan.
Under the current statute, people found guilty of any undue alterations shall be handed gaol sentences of up to seven years. It was primarily introduced as a means to cover the London Interbank Offered Rate (Libor) market following a global exploitation outrage which resulted in the banks fined with penalties worth billions of dollars.
According to the finance ministry, seven benchmarks which includes the WM/Reuters London fix, the dominant global benchmark in the $5.3 trillion-a-day currency market will be subject to the said law which shall be pending upon a consultation by Britain’s financial watchdog.
The European Union has made plans to criminalised the alleged rigging of financial market benchmarks following the Libor scandal, however those laws won’t be taking effect until the year 2016. This was in relation to a report according to the Financial Times, that a previous trader from Royal Bank of Scotland (RBS.L) was taken into custody last week in connection with a criminal investigation into the assertions that bank traders secretly tried to alter currency markets