Parallel Enforcement of Rate Rigging: Lessons to Be Learned from LIBOR

The manipulation of interest rate benchmarks such as the London Interbank Offered Rate and the Euro Interbank Offered Rate triggered enforcement actions by a multitude of competition authorities, anti-fraud agencies, and financial market regulators. While the authorities involved have closely cooperated in investigating the matter, little inter-agency coordination can be witnessed with respect to the prosecution and punishment of the committed offences. Instead of avoiding jurisdictional overlap, each authority sanctioned the worldwide collusion between the banks without applying any clear delimitation and generally without taking into account fines imposed for the same conduct elsewhere. In these kinds of cross-border and multi-agency cases, maintaining such isolated views creates concerns of double prosecution and excessive punishment. In view of the increasingly crowded international enforcement environment, guiding principles must be developed to coordinate the exercise of prosecutorial discretion from a global perspective and to ensure overall proportionality of sanctions.