Barclays Bank to pay Idaho $1M for alleged rate-rigging

Idaho will receive an estimated $1 million in restitution to settle alleged rate-rigging by Barclays, according to a news release Monday from Attorney General Lawrence Wasden.

The restitution is part of a $100 million nationwide settlement against Barclays Bank PLC and Barclays Capital Inc. following an investigation into whether they manipulated LIBOR — London Interbank Offered Rate — which is a key international benchmark interest rate that affects financial instruments worth trillions of dollars.

Idaho entities that will be eligible for restitution include the Idaho Housing & Finance Association, the Idaho National Engineering and Environmental Labs Employee Retirement, the Idaho State Building Authority and the Public Employee Retirement System of Idaho.

“London and Wall Street may seem very far away from Idaho cities like Jerome, Cottonwood and Salmon,” Wasden said in the news release. “But the manipulation of LIBOR had a negative effect on local governments and non-profit organizations all across the state.”

LIBOR rates are determined each day when a group of major banks submit the rate at which they could borrow from other banks. It is used to establish interest rates on loans worldwide, so it affects municipal financial investments and bonds, adjustable rate loans, mortgages and student loans.