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(Recasts with Libor priorities, adds details about fakeletters, dark pools)
By Kirstin Ridley
LONDON, July 17 (Reuters) - Britain's financial watchdogsaid it had prioritised the worst cases of Libor benchmarkinterest rate fixing, providing a signal that the largest finesfor banks' alleged role in the scandal may already have beenlevied.
Ten banks and brokerages have paid around $6 billion to dateto settle U.S. and European regulatory allegations that theymanipulated rates such as Libor (London interbank offered rate),a benchmark against which around $450 trillion of financialproducts from derivatives to home loans are priced worldwide.
The market has long been braced for similar settlements withLloyds and Deutsche Bank, which has alreadybeen fined by the European Commission over alleged involvementin benchmark interest rate cartels. Industry sources say thesetwo investigations are slowly nearing conclusion.
Martin Wheatley, the chief executive of the FinancialConduct Authority (FCA), said outstanding settlements had beendelayed because some investigations had gone beyond Libor andbecause of the complexities of regulatory coordination.
"There are still some investigations or actions we have notcompleted on Libor ... Why are they still ongoing? They weren'tas serious as the cases we took first," Wheatley told reporterson Thursday after the watchdog's first public annual meetingsince its creation last year.
"There are complications in some of those (outstanding)cases where it has become clear it is not just Libor we arelooking at ... and in some cases it's the need to coordinate andcooperate with multiple other agencies," he added.
FOREX PROBE CONCLUSION?
The FCA is among around 15 authorities around the world toinvestigate allegations of collusion and price manipulation inthe largely unregulated $5.3 trillion-per-day currency market,by far the world's largest.
Banks including Deutsche Bank, Lloyds, Citigroup,Barclays and JP Morgan Chase have fired orsuspended - and in some cases reinstated - foreign exchangetraders in the row over alleged manipulation.
Wheatley reaffirmed that he hoped to complete the foreignexchange investigation next year, while warning that thecomplexity of the inquiry made timing unpredictable.
"That is certainly our target," he said.
"But I do know that these things are very complicated ... soeven 2015 would be a relatively short time-scale given thedifficulties and complexities of these cases," he said.
David Green, the head of Britain's Serious Fraud Office(SFO), said last month the agency was examining information fromthe global investigation of currency markets, the first signthat the prosecutor may launch a criminal investigation.
The fact that material linked to the currency investigationhas landed on the SFO's desk could mean the FCA has foundpossible evidence of criminal wrongdoing during its ownexaminations and passed this on, some lawyers said at the time.
Wheatley declined to comment, saying only that the FCA hadcooperated with the SFO on a variety of investigations.
FAKE LEGAL LETTERS
The FCA is also keeping a keen eye on what it called a"quite widespread practice" by firms across industries to sendcustomers bogus letters from fictitious law firms or in-houselitigation departments in a move designed to pressure clientsinto paying bills.
Lloyds has admitted the bank had issued debt collectionletters under the name of a law firm, and payday lender Wongahas already been ordered by the FCA to pay 2.6 million pounds incustomer compensation for a similar practice.
"We are in the process of gathering more information,"Wheatley said, adding: "I don't think it would be fair to say,until we have a full picture, how widespread it will go."
(Additional reporting by Clare Hutchison; Editing by PravinChar and Jane Baird)
