ICAP, the world's largest broker of transactions between banks, is negotiating a fine with U.S. and U.K. regulators for allegedly helping traders manipulate the London interbank offered rate, or Libor, a person familiar with the matter said.
A settlement with the U.S. Justice Department, Commodity Futures Trading Commission and U.K. Financial Conduct Authority may be announced as early as this month, said the person, who requested anonymity because the talks are private. The amount of the fine will probably be less than the 290 million pound ($452.1 million) penalty levied against Barclays Plc in June last year, the person said.
Barclays, UBS AG and Royal Bank of Scotland Group Plc have paid a total of about $2.5 billion in fines for colluding to rig benchmark interest rates for profit or to mask their true cost of borrowing.
A fine for London-based ICAP will be the first against an interdealer broker in the investigation, which was opened by the CFTC in 2008. Interdealer brokers act as a go-between for banks that trade bonds, stocks, currencies, energy and derivatives.
ICAP has said it is cooperating with authorities in the probes. The firm suspended an employee and put three others on leave pending an outcome of an internal inquiry, a person familiar with the procedures said earlier this year.
Brigitte Trafford, a spokeswoman for ICAP, declined to comment.
The talks were reported earlier by the Wall Street Journal. Peter Carr, a spokesman for the Justice Department, declined to comment.
The negotiations between international authorities and ICAP are in the late stages, said another person familiar with the matter. The person cautioned that the timeline for the resolution, which may come in a matter of weeks, could slip as negotiations continue.
Top Justice Department officials have publicly said the U.S. side of the investigation includes the pursuit of convictions of banks and their employees involved in the rigging of benchmark interest rates.
Barclays, UBS and RBS are required to fully cooperate with the investigation into other banks and individuals, according to their agreements.