Big broker ICAP paying $87M to settle US, UK charges of manipulating LIBOR interest rate

Britain's ICAP PLC has agreed to pay about $87 million to settle U.S. and U.K charges of manipulating a key global interest rate, the fourth financial firm sanctioned in the international rate-rigging scandal.

The U.S. Commodity Futures Trading Commission said Wednesday that ICAP, the world's largest broker of trades between banks, engaged in rigging of the London interbank offered rate, or LIBOR, from October 2006 to January 2011.

Separately, U.S. prosecutors in Manhattan filed criminal charges Wednesday against three former ICAP brokers, saying they hurt the integrity of the financial markets by taking part in the scheme for their own financial gain.

The former brokers, Darrell Read of New Zealand and Daniel Wilkinson and Colin Goodman of Britain, were each charged with conspiracy to commit wire fraud and two counts of wire fraud. They face a maximum 30 years in prison for each of three counts.

A British banking trade group sets the LIBOR every morning after international banks submit estimates of what it costs them to borrow. The rate affects trillions of dollars in contracts around the world, including mortgages, bonds and consumer loans.

Britain's Barclays Bank and Royal Bank of Scotland, and Swiss bank UBS have paid a total $2.5 billion to settle charges of rigging the LIBOR.

Britain's Financial Conduct Authority fined ICAP $22.4 million, while the CFTC levied a $65 million penalty against the firm.

ICAP also agreed to take steps to ensure the accuracy of the interest rate information it submits.

The misconduct at ICAP involved a large number of brokers, including two managers, the regulators said.