Goldman Sachs just reached an agreement to settle class action charges that it, along with several other banks, rigged the ISDAfix benchmark rate, which is used to set terms for swaps transactions. ISDAfix determines valuations for interest-rate derivative products, and swaps are derivatives in which two counterparties exchange cash flows of one party’s financial instrument for those of the other’s.
The agreement marks the largest individual settlement reached over ISDAfix rigging litigation, although settlements arising from this suit have yielded hundreds of millions from several deals already reached.
According to the plaintiffs in the ISDAfix fraud case, the banks worked with interdealer broker ICAP PLC, which was tasked with managing the daily setting of the U.S. dollar-rate version of ISDAfix. The banks submitted rate quotes but worked with each other to make sure they set the rate at a point that was most profitable to them. The banks were accused of buying and selling derivative products before the fix was closed in order to obtain the price they wanted.
Goldman Sachs joins several other financial institutions that have agreed to settle the allegations against them in the ISDAfix fraud case for a total of $324 million. These include JPMorgan Chase ($52 million), Bank of America Corporation, Credit Suisse AG, Deutsche Bank AG and The Royal Bank of Scotland ($50 million each). Citigroup Inc. agreed to pay $42 million and Barclays PLC agreed to pay $30 million.
Call a Los Angeles Stock Fraud Attorney Today
Investments of any type involve some sort of risk. If you have questions about the legality of an investment, or have suffered a loss because of the negligent or fraudulent actions of your broker or brokerage firm, you may have certain legal rights that require your immediate attention.
Contact an experienced Los Angeles stock fraud attorney today for a consultation to discuss your rights and options.