TOKYO (MNI) – The European Union plans to strengthen rules against
manipulation of market indices across the region and make a fundamental
review of the rules on how Libor is set, the Financial Times reported on
Sunday.
Michel Barnier, the EU commissioner overseeing financial services,
will amend reforms to EU market abuse rules so that potential
“loopholes” are closed and criminal sanctions specifically cover
tampering with indices such as Libor and Euribor, the daily said.
The move by the EU came after Bob Diamond, head of Barclays,
resigned over Libor pricing scandals.
The current reform plans, first published last year, only
indirectly covered manipulation of market indices, according to the
report.
“I have never believed in self-regulation for a public good,”
Barnier was quoted as saying in an interview with the FT.
“I believe that we need to make sure there is more transparency in
this process.”
While the planned review could take several months, Barnier aims
within the next fortnight to bring forward changes to his market abuse
directive and regulation, according to the report.
The London Interbank Offered Rate (Libor) was set up in the 1980s
as an average of estimates precisely because there was no easy way to
calculate a market-based rate for unsecured interbank lending.
tokyo@marketnews.com
** MNI Tokyo Newsroom: 81-3-5403-4835 **
[TOPICS: M$$CR$,M$X$$$,M$$EC$,MGX$$$]
