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Swiss regulator COMCO fines banks over rate cartels

The Swiss Competition Commission said Dec. 21 that it fined various major European and U.S. banks over four instances of interest rate cartels.

The commission, known as COMCO, fined JPMorgan Chase & Co. approximately CHF33.9 million for operating a bilateral cartel with Royal Bank of Scotland Group Plc between March 2008 and July 2009 with the aim of influencing the Swiss franc LIBOR benchmark. RBS received a full immunity for disclosing the existence of the cartel to COMCO. The U.S. bank received a reduced fine for its cooperation in the investigation, COMCO said.

The two banks, along with Deutsche Bank AG and Citigroup Inc., were fined a total of approximately CHF14.4 million for conspiring to manipulate certain Japanese yen LIBOR submissions from 2007 to 2010, and in one of the infringements the Euroyen TIBOR. Citigroup was fined CHF3.8 million; Deutsche Bank CHF5.0 million; JPMorgan CHF1.7 million and RBS CHF3.9 million.

COMCO decided to discontinue proceeding against Mizuho Financial Group Inc., Sumitomo Mitsui Financial Group Inc. and Bank of Tokyo-Mitsubishi UFJ Ltd. The procedure continues against HSBC Holdings Plc, Lloyds Banking Group Plc, Rabobank, UBS Group AG, ICAP Plc, RP Martin and Tullett Prebon Plc. COMCO said it decided to discontinue the proceeding related to the Yen TIBOR benchmark against all parties.

In its investigation into the EURIBOR cartel, COMCO fined RBS, Barclays Plc and Société Générale SA a total of approximately CHF45.3 million for their participation in the cartel between September 2005 and May 2008. Barclays, which participated in the cartel for 32 months, was fined CHF29.8 million, while RBS was fined CHF12.3 million for its participation over an 8-month period.

SocGen, which was involved in the cartel for 26 months, was fined CHF3.3 million. Deutsche Bank, which participated in the EURIBOR cartel for 32 months, was spared from another fine for revealing the existence of the cartel to the regulator. The other banks received reductions of their respective fines for cooperating with the investigation.

Meanwhile, proceedings against BNP Paribas SA, Crédit Agricole SA, HSBC, JPMorgan and Rabobank still continue, COMCO noted.

Credit Suisse Group AG, JPMorgan, RBS and UBS were fined a total of approximately CHF5.4 million for colluding to operate a cartel on bid-ask spreads on Swiss franc interest rate derivatives between May and September of 2007. Credit Suisse was fined CHF2.0 million, while RBS and JPMorgan received reduced fines of CHF856,000 and CHF2.5 million, respectively, for cooperating with the probe. UBS received full immunity for revealing the existence of the cartel to COMCO.

The decisions can be appealed to Switzerland's Federal Administrative Court, the regulator said.