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(Answered)-Hello , This is a Case Study Essay that have five check to

Hello , This is a Case Study? Essay that have five check to include in a 2-3 page Apa format , No Plagiarism please.?? This course is MT219 Marketing. adding a Title page and references,??

Case studY



Chapter ?






Barclays Bank


? Noll / ? C. Zirkel



Banking on Ethics



On February 28, 2012, the United States Department of


Justice announced a criminal investigation into abuse


of the LIBOR, an important interest rate regulated by the


British Bankers? Administration. Four months later, Londonbased Barclays Bank was fined more than $440 million by


United States and English financial regulatory agencies for


knowingly manipulating the LIBOR to its own advantage.


The political and economic uproar that followed the exposure of Barclays? actions led to several resignations (including that of Barclays? CEO Bob Diamond) and further


criminal investigations. Former governor of New York Eliot


Spitzer called the incident ?the mega-scandal of megascandals,? while journalist Robert Scheer christened it ?the


crime of the century.?


The LIBOR, short for ?London Interbank Offered Rate,?


is the interest rate banks pay when they borrow money


from each other. To calculate this rate, up to 20 influential British banks report their own proposed bank-to-bank


lending rates. The highest and lowest rates are trimmed


off, and the remaining rates are averaged, creating the


LIBOR. A low LIBOR often points to financial stability, while


a high LIBOR indicates that banks lack confidence in each


other?s economic health. What Barclays was fined for was


proposing artificially low bank-to-bank rates to make itself


appear more stable than it actually was. However, further


investigations indicated that Barclays colluded with other


banks??nd perhaps even the British government??o






impact the LIBOR itself. An unnaturally low LIBOR would


suggest greater economic stability than actually existed,


misleading investors and loan-seekers in a potentially


volatile market, and thus creating profit for the banks involved in the collusion.


The rate manipulation carried out by Barclays affects


not only London banks and business executives, but


also small businesses and individuals?? erhaps even




you yourself. Because it has historically been considered


trustworthy and economically accurate, the LIBOR is


used all around the world as an interest rate and financial



instrument benchmark. Everything from currency values


(including the United States dollar) to multimillion-dollar


corporate debts to home mortgages to individual student loans depend on the LIBOR. While it may not seem


like it, each of these is a product that is marketed and


sold. As loans and exchanges of varying types are banks?


primary sources of profit, banks compete to exchange


these products within a market. At the consumer level,


consider how many car and credit card commercials


you have seen advertising a low interest rate. Hundreds


of trillions of dollars worth of these financial products


have been sold based on the LIBOR?? rate that may




not in fact accurately reflect the world?s shaky economic




Journalists and economic analysts have been quick to


reject the ethicality of Barclays? actions. As information about


the LIBOR scandal broke, TIME contributor Christopher


Matthews wrote, ?[Barclays? alleged collusion] speaks to the


moral compass, or total lack thereof, of the world?s financial


professionals?the public and the government no longer


trust the industry to set its own standards for acceptable


behavior.? In a piece for The Nation, Robert Scheer said, ?The


modern-day robber barons pillage with a destructive abandon totally unfettered by law or conscience and on a scale


that is almost impossible to comprehend.? Dennis Kelleher,


president of nonprofit financial watchdog organization


Better Markets, Inc. was perhaps most condemnatory of all:


?What we probably need is to wipe out this entire generation of so-called banking leaders who apparently have no


ethics or integrity.?While the total sum of the LIBOR scandal?s


consequences are yet to be seen, Barclays? actions may go


down in history as a monumental failure in business ethics


and corporate social responsibility.


Sources: Christopher Matthews, ?LIBOR Scandal: The Crime of the Century?,? TIME, July 9, 2012, http:// (Accessed July 10, 2012);


Danny Guttridge, ?Understanding the LIBOR Scandal,? Kapitall Blog, July 9, 2012,


/investment-idea/understanding-the-libor-scandal (Accessed July 10, 2012); ??The Mob Learned from Wall


Street?: Eliot Spitzer on the ?Cartel-style Corruption? behind Libor Scam,? Current, July 3, 2012, http://current




-corruption-behind-libor-scam (Accessed July 10, 2012).










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