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Banks braced for huge EU fines over Libor rate-rigging scandal

Banks braced for huge EU fines over Libor rate-rigging scandal

The interest rate-rigging scandal that has damaged the reputation of the banking sector looks likely to be reignited as Brussels is expected to impose multimillion-pound fines on a number of major firms for manipulating crucial benchmarks.

The action by Joaquín Almunia, the EU competition commissioner, will pile further pressure on Royal Bank of Scotland, the bailed-out bank already dealing with the fallout from a major systems meltdownthat left millions of customers without access to cash and allegations – which it denies – of mistreating its small business customers.

The 81% taxpayer-owned bank is reported to be among at least six major players in the financial markets, including Deutsche Bank in Germany and Citigroup in the US, caught up in the cartel investigation. The EU is said to be ready to impose record-breaking fines for alleged collusion for rigging key benchmark rates.

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