Ethical Issues and the European Commission

The European Commission fined JP Morgan, Credit Suisse and UBS 94 million Euros or $120 million for taking part in a financial cartel (an association of manufacturers or suppliers who have the intent of maintaining prices at high levels and restricting competition)

JP Morgan was given a 61.7 Million Euro fine ( $76,016,559.50) for rigging the Swiss franc LIBOR rate (London Interbank Offered Rates) benchmark rate banks charge each other for short term loans. From March 2008 to July 2009.

Also fined 10.5 million euros ($12,936,367.50) for manipulating the Swiss franc derivatives(security who’s price is derived from an asset. A contract between two parties on the price of an asset)

UBS’s fines were 12.7 million Euros($15,646,844.50)

Credit Suisse were 9.2 Million Euros($11,326,120.00)

Royal Bank of Scotland was not fined because they blew the whistle to the European Commission. They would have been fined 115 million euros($141,576,500.00)

The European Commission along with other authorities around the world has fined many top banks Billons of euros for rate rigging, breaking trade sanctions and numerous other behaviors.

The European Commission stated the banks in the cartel had agreed to fix a pricing element which normally would have been determined by the market between May and September 2007. Done to avoid competition by other banks.

All the banks in the cartel were given a 10% reduction in the fines if they admitted to the wrongdoing.

JP Morgan Chase has had a 4th quarter loss of $1.1 Billion after tax from the impact on their reputation from this and many other scandals:

1.Bernie Madoff

2.Processing of checks out of chronological order

3. Mortgage scandal