Piet Moerland to step aside earlier than planned as regulators penalise firm for 'one of the worst cases' in the scandal

The Libor rigging scandal was reignited on Tuesday when the boss of Rabobank quit after the Dutch bank was fined €774m (£662m) for manipulating the benchmark interest rate.

The fine, the second largest for Libor rigging after the £940m paid by Swiss bank UBS, was the fifth levied by regulators on both sides of the Atlantic in their attempt to crackdown on the manipulation of the key interest rate.

It comes as a new investigation begins into similar allegations of manipulation in the £3tn-a-day currency markets. UBS and Deutsche Bank became the latest to admit they were co-operating with investigations into currency benchmarks, as the US justice department acknowledged for the first time it was involved.

As Piet Moerland, the Rabobank chairman, announced he would step aside earlier than planned, regulators said some of the bank's traders had colluded with rivals at other financial firms to move rates to make a profit in one of the worst such cases they had investigated. About 30 individuals were involved, according to the mutually-owned bank – which was set up in 1898 to fund Dutch farmers and until now had escaped the financial crisis virtually unscathed and without needing the taxpayer bailouts handed to rivals.

There were 500 instances of attempted Libor manipulation, directly or indirectly involving at least nine managers. One manager facilitated a culture in Rabobank's offices in New York, London, Utrecht, Tokyo, Hong Kong and Singapore where attempted manipulation appeared to be accepted or even endorsed by the bank, regulators said.

Rabobank has also entered into a deferred prosecution agreement with the US department of justice.

The regulators unleashed the customary cache of emails containing colourful language used by traders. One manager said to a trader that he was "fast turning into [that trader's] bitch!!!!". Another was offered "546 beers" for changing rates. "Don't worry mate – there's bigger crooks in the market than us guys!" one submitter wrote.

Moerland, who had been with the bank – which prides itself on its integrity and its roots in the agricultural business – for 30 years, said he was shocked by the practices uncovered. The bank did not lose its AAA rating until 2011.

"I sincerely regret that a number of Rabobank employees acted in an inappropriate manner. This should never have taken place at Rabobank," said Moerland. "The conduct of these individuals, and the language of some of the individuals' communications, has shocked me. Rabobank fully understands the sense of indignation that this will cause both within our organisation and more broadly."

The US regulator, the Commodity Futures Trading Commission, said Rabobank employees had been making submissions to Libor that they saw at the time as "ridiculous", "obseenly [sic] high" and "silly low".

Libor – set in a number of currencies by special "submitters" at so-called panel banks – is supposed to be the price that banks would charge each other to borrow in the markets and is used to price about £300tn of contracts around the world. But Rabobank sat its submitters next to its traders and in some cases traders assumed the role of submitter. One of its US dollar traders was known as the "Ambassador" or "Ambass" while one of its submitters was referred to as "madame cadburry", according to documents released by the regulators.

The Financial Conduct Authority – which is levying £105m of the total fine – said the bank had no regard to the integrity of the market. Tracey McDermott, the FCA's director of enforcement and financial crime, said: "Rabobank's misconduct is among the most serious we have identified on Libor. Traders and submitters treated Libor submissions as a potential way to make money, with no regard for the integrity of the market. This is unacceptable."

The fine is largely related to yen Libor and, to a lesser extent, dollars and sterling.

None of the individuals were identified by the FCA although some were referred to by job titles by the US regulators. The FCA, along with other regulators, has fined Swiss bank UBS, RBS and Icap, as well as Barclays, the first bank to be fined, in June 2012.

In June, Moerland said he would retire from the bank next year. He is replaced by Rinus Minderhoud, a member of the supervisory board since 2002.

Moerland acknowledged that Rabobank had not appreciated the risk involved in setting Libor and its euro equivalent, Euribor. "We have taken severe disciplinary measures against employees directly involved in or otherwise responsible for the unacceptable conduct," he added. Some had already left and five been fired with €4.2m of bonuses being withheld.

SAC fraud



SAC Capital is to plead guilty to securities fraud as part of a landmark settlement over insider trading at the hedge fund, according to the Wall Street Journal.

The Connecticut-based company, which is run by the billionaire investor Steven Cohen, has been under investigation for seven years.

The paper said the exact timing of any agreement had not yet been agreed but a deal could be unveiled by the end of this week.

It comes as the US authorities are trying to finalise the details of a $13bn (£8bn) agreement with JP Morgan over the sale of toxic mortgage bonds. That agreement was expected last week, but talks appear to have stalled.