RBS traders boasted of Libor 'cartel'

Senior traders at Royal Bank of Scotland boasted about operating a “cartel” that made “amazing” amounts of money by rigging interest rates, it has been disclosed.

Internal messages revealed in court documents apparently show how traders claimed they could manipulate Libor, which is used to set borrowing costs for millions of businesses, consumers and investors.

The messages, some sent just months before the taxpayer was forced to bail out RBS at a cost of more than £40bn, suggest the practice was condoned and encouraged by senior executives at the bank, and have now dragged the taxpayer-backed lender to the heart of the Libor scandal.

MPs have warned that the scale of RBS’s involvement in the scandal means it could face an even bigger fine than Barclays, which paid a record £290m in July after admitting attempting to manipulate Libor. The bank could also be hit with billions of pounds in damages claims.

Tan Chi Min, a former senior trader at RBS’s global banking and markets division in Singapore, has alleged that managers “condoned collusion” between staff to maximise profits by rigging Libor.

Mr Tan, who worked for RBS from August 2006 to November 2011, was eventually sacked for gross misconduct, but claims the bank made him a “scapegoat” for malpractice condoned by managers.