The Federal Reserve Was Worried About LIBOR Manipulation As Early As 1998

[FarCenter]

While Rabinowitz's paper does not imply that banks had been colluding to manipulate rates at the time it was written, it suggests that the Fed was already be concerned about the effects of inaccurate reporting by banks about their lending practices ten years before the financial crisis.

Further, acknowledgments that a very small contingent of banks potentially could manipulate rates suggests that the Fed may very well have seen this coming.

Traders speculate that LIBOR manipulation has taken place pretty openly for many years, and this is a sign that the Fed acknowledged this possibility very early on.


Read more: http://www.businessinsider.com/the-federal-reserve-was-worried-about-libor-manipulation-as-early-as-1998-2012-7