Australia cracks down on rate riggers as bank chiefs grilled

Manipulating financial benchmarks will become a criminal offence in Australia, the government announced Tuesday, as the nation’s largest lenders prepared to be grilled by a parliamentary committee over their practices.
Treasurer Scott Morrison said the tough new rules would “ensure that past egregious conduct by the banks in manipulating benchmarks is prevented in the future”.
Criminal penalties, including jail time, could be imposed for market manipulation in setting bank bill swap (BBSW) rates-used to set the price of financial products such as bonds, loans and derivatives-and other key benchmarks such as equity indexes and Treasury Bond Futures settlement prices.
The BBSW-the rate at which banks lend to each other-was in the past set by 14 banks each business day, who quoted the interest rate they were paying and receiving.