If you are currently working for a bank, and are mulling over the idea of attempting to manipulate a financial benchmark, a few words of advice: First, consider not doing that. Next, if you decide that you really must attempt to manipulate one or more financial benchmarks in you life, think about not instant messaging one of your co-conspirators to happily report just how damn easy it was to do. Finally, and if you've already gone ahead and ignored our first two pieces of advice this is sort of neither here nor there BUT, think about not punctuating your confession with a flipping smiley face, as it will come back to haunt you.
The trader wrote that ISDAfix, as the benchmark is known, is “surprising[ly] easy to push! [I] think last week, [I] pushed it 3bps from 10:55 to 11:05 :),” according to messages cited by the U.S. government Wednesday. Now that smile has turned upside down: Citigroup is paying $425 million to resolve U.S. Commodity Futures Trading Commission claims that it tried to rig several interest-rate benchmarks from 2007 to 2012. The New York-based bank neither admitted to nor denied the allegations, which concern ISDAfix and benchmarks in London and Tokyo. The alleged ISDAfix violations generated the majority of the penalty, $250 million.