Switzerland Banking giant, UBS, is expected to be fined a whopping $1 billion for allegations of rigging Libor's benchmark of interest rates, reported The Economic Times.
LIBOR - "London Interbank Offered rate is the average interest rate charged from banks if borrowing from other banks" explains Wikipedia.
UBS is close to admitting its criminal charges. Employees of the Bank's Japanese unit had reported phony interest rates for which the bank is expected to plead guilty, said The New York Times.
UBS was previously involved in a another scandal where an ex-employee, Kweku Adoboli, was charged with deceitful trade practices in November, reported The Guardian. The UBS controversy comes shortly after the Barclays scandal for the same conduct. However, the fine levied on UBS appears to be far higher than that on Barclays, reported The Economic Times.
Recently, HSBC and Standard Chartered were also found guilty in money laundering and sanction breach cases, which caused them to shell out a total fine of £1.6 billion in a week, reported The Guardian.
Three men were arrested on account of the UBS scam namely, Tom Hayes, a former employee of both Citigroup and UBS , Jim Gilmour and Terry Farr- workers at a city based brokering firm, reported The Guardian.
"I'm not sure how much more reputational damage can be done to UBS," Chris Wheeler, analyst at Mediobanca, London told The Economic Times.
"They are rebuilding that slowly, but it won't help the wealth management business when you see this as a headline." he added.
The banking sector has been facing rough times as more banking giants are finding themselves in dirty waters. This could affect the appeal of investment banking in the job market and also lead to loss of jobs for the existing employees in the sector, reported Economic times.
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