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BRUSSELSLondon-based brokerage firm ICAP PLC was fined 14.

9 million ($17 million)


on Wednesday by the European Unions antitrust body for participating in an attempt to
manipulate key benchmark interest rates.
The European Commission, the EUs executive arm, had already imposed fines on a number of
major banks in December 2013 that decided to settle the case. ICAP chose not to settle this case.
In a statement, the Commission said it found that ICAP facilitated six of the seven distinct cases
it had identified as breaching rules in the yen interest rate derivatives sector. That included
disseminating misleading information to some of the banks of the panel that set yen rates and
serving as a communications channel between traders involved in anticompetitive activities, the
EU said.
The Commission also said that ICAP used its contacts with several banks represented on the yen
rates panel that didn't breach EU rules with the aim of influencing theirsubmissions.
"Todays decision to fine the broker ICAP sends a strong signal that assisting companies in their
cartel activities has severe consequences, EU antitrust chief Margrethe Vestager said.
In a statement, ICAP said it disputed the Commissions decision and will challenge the ruling.
ICAP doesn't accept the ECs decision, which it believes is wrong both in fact and in law. This
is a regulatory matter that has already been settled, the company said. It is not a competition
issue, and the EC has presented no evidence that ICAP facilitated a competition law violation.
ICAP will be challenging this decision at appeal in the European Courts.
ICAP reached a settlement in September 2013 with U.K. and U.S. regulators over their probes
into manipulation of yen benchmark rates.
In December 2013, the European Commission imposed fines worth 669.7 million on UBS,
RBS, Deutsche Bank, Citigroup, J.P. Morgan and the broker RP Martin for their role in yen
benchmark rates cartels.

That was part of billions of euros of fines levied by regulators against financial institutions in
connection with probes into manipulation of the London interbank offered rate, or Libor, and
other widely used financial benchmarks.

(Bloomberg) -- ICAP Plc, the worlds largest broker of transactions between


banks, was fined 15 million euros ($17.2 million) by the European Unions
antitrust arm for helping traders to manipulate benchmark interest rates tied
to the Japanese yen.
ICAP spread misleading information to lenders on a panel that set the
interbank lending rate for yen Libor and aided contacts between traders, the
European Commission said in an e-mailed statement from Brussels today.
The information was veiled as predictions or expectations of where the yen
Libor rates would be set, the commission said. It was aimed at influencing
certain panel banks that did not participate in these infringements to submit
rates in line with the adjusted predictions or expectations.
Global regulators have moved to tighten oversight of benchmark rates after
the worlds biggest banks paid billions of dollars to settle rigging allegations
and moved to police contacts between traders. U.S. officials said ICAP brokers
took advantage of a poor compliance culture at the company to help traders
manipulate yen Libor in exchange for money, dinners and champagne.
The London-based broker said it would appeal the fine to the EU courts
because the decision was wrong both in fact and in law, according to an emailed statement. It is not a competition issue and the commission has
presented no evidence that ICAP facilitated a competition law violation.

Settle Charges
Authorities are probing how derivatives traders and bankers colluded on
interest-rate data to ensure benchmarks benefited them, potentially affecting
more than $300 trillion of loans, financial products and contracts tied to the
rate.
UBS Group AG, Royal Bank of Scotland Group Plc, Deutsche Bank AG,
JPMorgan Chase & Co., Citigroup Inc. and brokerage RP Martin Holdings Ltd.
previously agreed to a combined EU penalty of 669.7 million euros.
ICAP refused to join financial institutions in paying fines to settle the EU case
in 2013. Its already paid fines of $88 million in a deal with U.S. and U.K.
regulators to settle charges over contacts with UBS traders.
The EU said ICAP facilitated six out of seven separate yen Libor cartels
between 2007 and 2010. It said the broker told lenders its yen-Libor
predictions to try to influence them to send similar rates to the panel, used
other contacts with banks to sway submissions and served as a
communications channel between a Citigroup and an RBS trader.

Broker Fines
The ICAP fine far outweighs the 247,000-euro penalty that another broker, RP
Martin, agreed to pay last year after it settled with the EU over involvement in
one cartel.
The EU said the ICAP penalty reflected the gravity, duration and nature of
ICAPs involvement as a facilitator as well as the need to ensure that the fine
has a sufficiently deterrent effect.

JPMorgan Chase & Co., HSBC Holdings Plc and Credit Agricole SA also
refused to join a parallel settlement over Euribor rates and were sent an EU
antitrust complaint last year. Credit Agricole has complained to the EUs
ombudsman, saying the commission has prejudged the outcome of the probe.
ICAP had also filed a complaint.
Interdealer brokers such as RP Martin and ICAP act as go-betweens for banks
that trade bonds, stocks, currencies, energy and derivatives.
Brokers assumed greater influence as credit markets froze during the early
stages of the financial crisis in 2007. Bankers who made submissions to Libor,
the London Interbank Offered Rate, increasingly relied on information from
the brokers to determine what figures to contribute because there were no
trades on which to base them. That left the benchmark vulnerable to
manipulation by traders trying to profit from bets on derivatives.