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Today [1. Bank] was hit with a [2. Size of penalty] fine by [3. Regulatory authority] for its part in manipulating the [4. Benchmark] market. The market is worth [5. Size of market].
[6. Stern statement from regulator]
[7. Contrite statement from bank]
In the charges, the regulator accused [8. Trader or group] of manipulating [4. Benchmark] reference rates in order to flatter trading positions. In one particular incident, [9. Example of manipulation, preferably featuring colorful trader-speak].
[1. Bank] previously settled charges of rigging the [10. Other benchmark] market, paying a fine of [11. Size and date of previous penalty]. It still faces potential penalties related to investigations, appeals, and other legal entanglements in markets that include [12. Benchmarks under suspicion].
[13. Damning fact about the timing and/or context of the latest scandal]
The bank’s latest fine is worth around [14. Percentage] of its most recent quarterly profit.
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2. £26 million ($43.8 million)
3. UK’s Financial Conduct Authority (FCA)
5. $20 trillion per day, according to the Wall Street Journal
6. “A firm’s lack of controls and a trader’s disregard for a customer’s interests have allowed the financial services industry’s reputation to be sullied again,” said Tracey McDermott of the FCA.
7. “We very much regret the situation that led to this settlement,” said Barclays boss Antony Jenkins.
8. Daniel Plunkett, a former trader
9. Plunkett emailed colleagues to say he was hoping for a “mini puke” in the daily price of gold when it was set by a syndicate of five banks, including Barclays, the following day. The subsequent drop in the gold fix triggered trading gains for Plunkett and avoided paying out an options contract to a bank client.
11. £290 million in June 2012
12. Foreign exchange, electricity prices, mortgage-backed securities, and credit default swaps
13. The “mini puke” incident came a day after Barclays’ high-profile settlement over Libor manipulation. “The investigation and outcomes in that case meant that the firm, and Plunkett, were clearly on notice of the potential for conflicts of interests around benchmarks,” chided the FCA in a statement.
* Bloomberg: Barclays Fined $44 Million for London Gold Fix Failings
* FCA press release announcing the Barclays settlement. Details of the case against the bank (pdf) and against Daniel Plunkett (pdf).
* Explainer on how the daily gold price is fixed