What is the Libor scandal?
This refers to revelations that financial institutions and individuals conspired to fix the London Interbank Offered Rate (Libor), which compiles interest rates that banks use in order to assess the overall health of the financial system and set borrowing rates.
Where have you heard about the Libor scandal?
The events received widespread media coverage across the globe from 2008 onwards, when the Wall Street Journal published an article alleging that institutions had deliberately understated borrowing costs during the 2008 financial crisis.
What you need to know about the Libor scandal.
Libor sets the price that businesses pay for loans and consumers pay for mortgages, as well as being used for pricing derivatives. It is also an indication of the health of individual institutions and the overall financial system. The scandal involved banks and bankers allegedly conspiring to submit higher or lower rates, often boosting their own personal profits and giving a false indication of the institution's financial health. This also affected the rates that borrowers and other businesses had to pay for loans.
Find out more about the Libor scandal.
Manipulation of Libor may have helped contribute to the 2008 global financial crisis .