The regulator said the breaches of its requirements encompassed a number of issues and involved a significant number of employees over a number of years.
In a cross-border investigation the FSA worked with the US Commodity Futures Trading Commission (CFTC), the US Department of Justice, the Federal Bureau of Investigation and the Securities and Exchange Commission.
As well as the FSA’s fine, the CFTC brought attempted manipulation and false reporting charges against Barclays for similar failings, originally imposing a penalty of $200m, but agreeing to a settlement of $160m.
Barclays’ misconduct included making submissions that formed part of the Libor and Euribor setting process that took into account requests from Barclays’ interest rate derivatives traders. These traders were motivated by profit and sought to benefit Barclays’ trading positions.
On top of that Barclays sought to influence the euribor submissions of other banks contributing to the rate setting process and reduced its Libor submissions during the financial crisis as a result of senior management’s concerns over negative media comment.
In addition, the FSA found Barclays failed to have adequate systems and controls in place relating to its Libor and Euribor submissions processes until June 2010 and failed to deal with issues relating to its Libor submissions when these were escalated to Barclays’ Investment Banking compliance function in 2007 and 2008.
Tracey McDermott, acting director of enforcement and financial crime, said: "Barclays’ misconduct was serious, widespread and extended over a number of years. The integrity of benchmark reference rates such as Libor and Euribor is of fundamental importance to both UK and institutional financial markets. Firms making submissions must not use those submissions as tools to promote their own interests.
"Barclays’ behaviour threatened the integrity of the rates with the risk of serious harm to other market participants."
The regulator threatened other firms that they should be in "no doubt" about the serious consequences about of this type of failure and added that it continues to pursue a number of other significant cross-border investigations in the area.
Due to its cooperation during the investigation, Barclays qualified for a 30% discount under the FSA’s settlement discount scheme.
