UK care home group sues Barclays for £37m over LIBOR rigging
A UK care home group is suing Barclays for £37m over the rigging of LIBOR in a landmark case which could force the bank to disclose the names of managers involved in the scandal.
Guardian Care Homes, based in the English city of Wolverhampton, bought over £70m worth of “swaps” from the bank in 2007 to protect itself against interest rate spikes.
However, it claims Barclays deliberately sold a product that depended on the LIBOR benchmark, even though senior management knew they were lying about the bank’s daily submission, UK newspaper the Times reports.
In a judgement at the High Court in London, Mr Justice Flaux said the issue was legitimate and would go to trial in a full hearing next year.
“Any senior management who gave the matter a moment’s thought would have concluded any customer would be entitled to expect the rate had not been manipulated,” he added.
The judgement also made clear that if Barclays does not settle the case before the case is next in court, it may have to disclose the names of senior managers who knew about the ‘low-balling’ of the rate.
Barclays was fined £290m earlier this year by US and UK regulators for LIBOR-rigging, while a number of other banks are still under investigation.
This article was first published on Investment Week