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U.S. judge orders UBS unit in Japan to pay $100 mln over Libor

Wed, 18th Sep 2013 21:11

* UBS Securities Japan admitted criminal conduct

* Swiss bank previously reached $1.5 bln global settlement

Sept 18 (Reuters) - A Japanese investment banking unit ofUBS AG was ordered on Wednesday to pay a $100 millioncriminal fine after pleading guilty to wire fraud in connectionwith its role in the manipulation of the benchmark interest rateLibor.

UBS Securities Japan Co had entered its plea last Dec. 19,one day after its Zurich-based parent agreed to pay about $1.5billion in penalties to resolve criminal, civil and regulatoryprobes by authorities in the United States, the United Kingdom,Switzerland and Japan into alleged rate manipulation.

The U.S. Department of Justice agreed at the time not toprosecute UBS, apart from the Japanese unit. In exchange, UBSadmitted wrongdoing tied to rate manipulation.

"Make no mistake - for UBS traders, the manipulation ofLibor was about getting rich," Lanny Breuer, who at the time ledthe Justice Department's criminal division, said in discussingthe settlement last December.

Wednesday's penalty is part of the global settlement, andwas outlined in a joint sentencing recommendation on Sept. 12 bythe Justice Department and UBS Securities Japan.

The penalty was approved by U.S. District Judge RobertChatigny in Hartford, Connecticut. UBS has offices in Stamford,also in Connecticut.

Karina Byrne, a UBS spokeswoman, declined to comment.

Libor is also known as the London Interbank Offered Rate,and is used to set rates for trillions of dollars of mortgages,credit cards, student loans, derivatives contracts and otherfinancial instruments.

Prosecutors accused UBS Securities Japan of scheming fromNovember 2006 to August 2009 to manipulate yen Libor to benefita senior trader's trading positions.

More than a dozen banks and brokerage firms have beeninvestigated worldwide over alleged Libor manipulation. BarclaysPlc and Royal Bank of Scotland Group Plc havealso reached settlements with authorities.

The case is U.S. v. UBS Securities Japan Co, U.S. DistrictCourt, District of Connecticut, No. 12-cr-00268.

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