LIBOR Criminals Fall Out: Treasury and BoE Point Finger at Each Other
July 21, 2012 • 9:15AM

Accusations were going back and forth across the Atlantic yesterday, as both the Bank of England (BoE) and the U.S. Treasury issued reports and documents that purport to show that the other was the bigger LIBOR criminal.

The BoE dumped 80 pages worth of 2008 e-mails on its website, between BoE officials and the New York Fed's Timothy Geithner, along with a press release stating that the "Geithner memorandum [with recommendations made to the BoE regarding LIBOR fixing] contains no allegation of wrongful behavior.... At no point did the FRBNY draw the attention of the Bank to evidence of wrongdoing in the setting of BBA [British Banking Association's] LIBOR." The BoE adds that aside from Geithner's June 2008 memorandum, "none of the other documents published on 13 June 2012 by the FRBNY had been shared with the Bank."

Both The New York Times and Bloomberg extensively cover the BoE's e-mails, giving credence to its charge that Geithner had never alleged any wrongdoing. The Wall Street Urinal takes Geithner's side.

Not to be outdone, the U.S. Treasury issued its own report today, which arrives at the brilliant conclusion that the process for setting LIBOR is "flawed" and poses a threat to the stability of financial markets. It asserts that unnamed banks have engaged in "an opaque and closed process" for setting LIBOR, allowing the rate to be manipulated, going on to say that a British banking trade group, meaning the BBA, sets the LIBOR every morning after international banks submit estimates of what it costs them to borrow money.

The bottom line? Provided we do what Lyndon LaRouche has laid out as the focus for the coming week, no one is going to escape the punishment and imprisonment they deserve for their murderous crimes. In an article in Truth-Out today, columnist Ellen Brown makes the appropriate point that the LIBOR-rigging is tantamount to "criminal racketeering under federal RICO statutes .... and class-action RICO suits by victims are expected." RICO laws brought down the Gambino crime family, the Genovese crime family, Hells's Angels, and the Latin Kings gang, Brown noted, suggesting that the LIBOR murderers are in the same league.

Note too that Andrew Tyrie, the British Member of Parliament who heads the newly-created Parliamentary Committee on Bank Standards, told the London Daily Telegraph that the BoE's e-mails released today justify a much deeper investigation into the BoE's failings, as well as those of the regulators and the BBA. "It's clear from what's come out, that the FSA [Financial Services Authority] final notice report [into Barclays' LIBOR fixing] is not the final word on all that's happened. It's now imperative that the review conducted by the relatively newly-appointed Martin Wheatley successfully gets to the bottom of it."