Commissioner for the Single Market Michel Barnier is expected to bring forward changes to his market abuse directive and regulation within the coming weeks, the Financial Times said Monday.

In response to the Libor rate-rigging scandal, Barnier will amend reforms to European Union market abuse rules so that potential loopholes are closed and criminal sanctions specifically cover tampering with indices such as Libor and Euribor.

Barnier is cited as calling the falsification of such benchmark rates a “betrayal” with “potentially systemic consequences”.

The scandal surrounding Libor – the London interbank lending rate – has rocked the City of London over the past few weeks and has seen the resignation of UK bank Barclays’ chief executive Bob Diamond.

Review of market indices to come

Barney Frank, the congressman who led a US financial regulation overhaul, told the Financial Times that banks “monkeying” with Libor for their own benefit was “outrageous”.

The German Bundesbank has been calling for reforms to a system that was “vulnerable to fraud”, said Andeas Dombret, a board member.

Barnier is expected to work with the European Parliament to add amendments to the market abuse rules he already proposed last year.

Amendments would require the approval of all EU governments and the parliament, which could take up to a year.

A review of market indices to judge if they should be brought under the watch of external regulators is also due to be carried out by Barnier’s staff, and could also take several months.

"I have never believed in self-regulation for a public good. I believe that we need to make sure there is more transparency in this process," he is quoted as saying.eforms to a system that was “vulnerable to fraud”, said Andeas Dombret, a board member.

The Commission has meanwhile been undertaking its own inquiry focusing on allegations the banks artificially held down the Euribor rate so as to make their finances appear stronger than they actually were.

Several major European banks have been drawn into the investigation.