Barclays set to fend off attempts to reopen Libor settlement with US authorities

By ALEX HAWKES, FINANCIAL MAIL ON SUNDAY

Updated: 04:08 EST, 29 June 2014

Clean-up: Barclays boss Antony Jenkins

Barclays is set to fend off attempts to reopen its Libor settlement with US authorities after they launched a fresh legal case against the bank over a new trading scandal.

Fears have been growing in the City that a lawsuit over alleged fraud at the bank, which boss Antony Jenkins has pledged to clean up, could let the US’s top watchdog reopen the rate-rigging case.

The concerns helped wipe £2 billion off the value of Barclays last week, but City lawyers said the new claim would not provide grounds to reopen the Libor case. ‘The agreement covers all potentially criminal conduct. There’s certainly nothing in there that would be triggered by a regulatory breach,’ a financial lawyer told The Mail on Sunday.

New York attorney general Eric Schneiderman last week accused Barclays of ‘fraud and deceit’. The bank told investors its LX trading arm, where professional investors can trade shares away from the glare of the public stock market, was free of high-frequency traders, who may have an advantage over unknowing investors. In fact such traders were using the  so-called dark pool.

At the time of the Libor case Barclays secured a non-prosecution agreement to avoid a criminal case, but immunity would be waived if it were found to have committed a new offence. The agreement was seen as critical to Barclays keeping its licence in America.

Barclays declined to comment.