EU slaps $520mln fine on big banks

BRUSSELS: The EU's top anti-trust regulator on Wednesday slapped $520 million in fines on three major banks for rigging the Euribor interest rate benchmark used for a wide range of financial instruments.

The sanction by Brussels is the latest example of authorities trying to punish malpractice by the world´s biggest banks in the years running up to the financial crisis in 2008.

HSBC, JP Morgan Chase and Credit Agricole were fined 485 million euros ($520 million) "for participating in a cartel in euro interest rate derivatives," the European Commission, the EU´s executive arm, said in a statement.

The three banks had held out for a settlement with the EU in 2013 that saw Deutsche Bank, Societe Generale and Royal Bank of Scotland accept responsibility in the case. "Today´s message sends a clear message: banks and all companies have to respect EU rules," said the EU´s competition chief Margarethe Vestager at a news briefing.

The Euribor case is one of many involving the business of setting benchmark rates, such as the Libor or the Yen Libor, that are used to price a wide range of loans, including mortgages and student loans.  In recent years, about a dozen of the world´s biggest banks have admitted widespread collusion to manipulate these rates and received huge fines and even jail terms. Participation in the secret cartel schemes can be very lucrative for banks.