Everything Is Rigged: The Biggest Price-Fixing Scandal Ever
Dating back perhaps as far as the early Nineties, traders and others inside these banks were sometimes calling up the company geeks responsible for submitting the daily Libor numbers (the “Libor submitters”) and asking them to fudge the numbers. Usually, the gimmick was the trader had made a bet on something – a swap, currencies, something – and he wanted the Libor submitter to make the numbers look lower (or, occasionally, higher) to help his bet pay off.
Famously, one Barclays trader monkeyed with Libor submissions in exchange for a bottle of Bollinger champagne, but in some cases, it was even lamer than that. This is from an exchange between a trader and a Libor submitter at the Royal Bank of Scotland:
SWISS FRANC TRADER: can u put 6m swiss libor in low pls?…
PRIMARY SUBMITTER: Whats it worth
SWSISS FRANC TRADER: ive got some sushi rolls from yesterday?…
PRIMARY SUBMITTER: ok low 6m, just for u
SWISS FRANC TRADER: wooooooohooooooo. . . thatd be awesome
Screwing around with world interest rates that affect billions of people in exchange for day-old sushi – it’s hard to imagine an image that better captures the moral insanity of the modern financial-services sector.
Michael Sauers is currently the Director of Technology for Do Space in Omaha, NE. Michael has been training librarians in technology for the past twenty years and has also been a public library trustee, a bookstore manager for a library friends group, a reference librarian, serials cataloger, technology consultant, and bookseller since earning his MLS in 1995 from the University at Albany’s School of Information Science and Policy. Michael has also written dozens of articles for various journals and magazines and his fourteenth book, Emerging Technologies: A Primer for Librarians (w/ Jennifer Koerber) was published in May 2015 and more books are on the way. In his spare time he blogs at travelinlibrarian.info, runs The Collector’s Guide to Dean Koontz Web site, takes many, many photos, and typically reads more than 100 books a year.
View all posts by Michael Sauers
Dating back perhaps as far as the early Nineties, traders and others inside these banks were sometimes calling up the company geeks responsible for submitting the daily Libor numbers (the “Libor submitters”) and asking them to fudge the numbers. Usually, the gimmick was the trader had made a bet on something – a swap, currencies, something – and he wanted the Libor submitter to make the numbers look lower (or, occasionally, higher) to help his bet pay off.
