Shivani Gadhavi
Published On: December 31, 2021 at 16:12 IST
The Federal Appeals Court in New York on December 30, 2021 ruled that global banks such as J P Morgan Chase & Co and UBS Group AG are all subject to the jurisdiction of the United States for manipulating the London Inter-bank Offered Rate (LIBOR).
A Three-Judge Panel of the Federal Appeals Court stated that the Courts of United States can exercise “conspiracy jurisdiction” over the aforementioned global banks if other members of the conspiracy took steps to advance the scheme from within the United States.
The New York Federal Appeals Court revoked an Order from 2016 of the United States District Judge Naomi Reice Buchwald, who ruled that her Court has no jurisdiction over the matter pertaining to the Defendants from the bank.
The United States Circuit Judge Richard Sullivan stated on behalf of the Three-Judge Panel, “Plaintiffs have Alleged overt acts taken in the United States to advance the suppression conspiracy; at this stage of the Litigation, that is enough to establish Personal Jurisdiction.”
It has been Alleged that the case pertains to London Interbank Offered Rate (LIBOR) manipulation by many institutional investors like municipalities and usage of public pension funds. The Plaintiffs argue that banks located in United States manipulate the LIBOR via their membership in the British Banker’s Association.
The Court also observed that senior executives from the United States manipulated the LIBOR by ordering their employees to do so via emails. The Federal Appeals Court cited an email sent by an executive of the New York based J P Morgan, who had advised the LIBOR submitter to keep it to the lower side.