Citigroup, JPMorgan to pay $182.5 million to settle rate-rigging lawsuit

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Pedestrians walk past a Citigroup Inc. Citibank branch in Washington, D.C., U.S., on Thursday, Jan. 7, 2016. Citigroup Inc. is expected to report fourth-quarter earnings on January 15. Photographer: Andrew Harrer/Bloomberg via Getty Images

Jonathan Stempel

NEW YORK (Reuters) – Citigroup Inc and JPMorgan Chase & Co will pay $182.5 million to settle U.S. investor litigation claiming they violated antitrust law by conspiring with other banks to rig a key European interest rate benchmark.

A preliminary settlement addressing the banks’ alleged manipulation of the European Interbank Offered Rate, or Euribor, was filed on Wednesday night with the U.S. District Court in Manhattan, and requires a judge’s approval.

Five banks have reached $491.5 million of settlements in the case, including earlier settlements of $170 million by Deutsche Bank AG, $94 million by Barclays Plc and $45 million by HSBC Holdings Plc.

Euribor is the euro-denominated equivalent of Libor, a benchmark for setting rates on hundreds of trillions of dollars of credit cards, student loans, mortgages and other debt.

Investors including the California State Teachers’ Retirement System (CalSTRS) pension fund accused banks of rigging Euribor and fixing prices of Euribor-based derivatives from June 2005 to March 2011 to profit at their expense.

According to the settlement agreement, Citigroup and JPMorgan denied wrongdoing, and settled to avoid the cost and distraction of litigation. Several banks remain defendants.

Citigroup spokeswoman Danielle Romero-Apsilos and JPMorgan spokeswoman Tasha Pelio declined to comment on Friday. Vincent Briganti, a lawyer for the plaintiffs, also declined to comment.

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Many lawsuits in the Manhattan court seek to hold banks liable for alleged rigging in interest rate, commodity, currency and other financial markets.

JPMorgan this week reached a separate $7 million settlement of investor claims that it conspired with rivals to rig the Australian Bank Bill Swap Reference Rate, becoming the first bank to settle that litigation. The same law firms represented investors in that case and the Euribor case.

The case is Sullivan et al v. Barclays Plc et al, U.S. District Court, Southern District of New York, No. 13-02811.

Reporting by Jonathan Stempel in New York; Editing by Susan Thomas

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Godwin Okafor is a Financial Journalist, Internet Social Entrepreneur and Founder of Naija247news Media Limited. He has over 16 years experience in financial journalism. His experience cuts across traditional and digital media. He started his journalism career at Business Day, Nigeria and founded Naija247news Media in 2010. Godwin holds a Bachelors degree in Industrial Relations and Personnel Management from the Lagos State University, Ojo, Lagos. He is an alumni of Lagos Business School and a Fellow of the University of Pennsylvania (Wharton Seminar for Business Journalists). Over the years, he has won a number of journalism awards. Godwin is the chairman of Emmerich Resources Limited, the publisher of Naija247news.

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