JPMorgan, Citigroup Among Banks Sued in Aussie Rate-Fix Case

By Narayanan Somasundaram & Alfred Liu - August 18, 2016 — 12:12 AM EDT Updated on August 18, 2016 — 6:15 AM EDT

JPMorgan Chase & Co., Citigroup Inc. and Morgan Stanley are among 16 banks being sued by funds in the U.S. for allegedly manipulating a key Australian interest rate benchmark to generate hundreds of millions of dollars in illicit profits.

The class action, filed in the U.S. District Court for the Southern District of New York, claims the banks sought to fix the bank bill swap rate, the local equivalent of Libor, which is used to price billions of dollars of floating-rate bonds and syndicated loans. It cites a civil action launched earlier this year by Australia’s securities regulator against Australia & New Zealand Banking Group Ltd., National Australia Bank Ltd. and Westpac Banking Corp., which are also named in the U.S. action.

“Defendants generated hundreds of millions of dollars in illicit profits by artificially fixing BBSW-based derivatives prices at levels that benefited their trading books,” according to the complaint, which is seeking a court order to force the banks to “disgorge their ill-gotten gains.”...

Read more:
http://www.bloomberg.com/news/articles/2016-08-18/australian-banks-named-in-u-s-lawsuit-over-swap-rate-setting