Six banks facing lawsuit

The Canadian Press

WHITE PLANES, N.Y.–A class-action lawsuit filed in a U.S. court alleges six Canadian banks and three others conspired to increase the profitability of their derivatives trading business by manipulating an interest rate benchmark for about seven years.
The Fire & Police Pension Association of Colorado filed the claim against BMO, Bank of Nova Scotia, CIBC, National Bank of Canada, Royal Bank of Canada, TD, and three others at the United States District Court for the Southern District of New York on Friday.
The claim alleges the banks manipulated the Canadian dealer offered rate, which reflects what rate contributors are willing to lend to corporate clients using an instrument called a bankers’ acceptance, from at least Aug. 9, 2007 to June 30, 2014.
The claim alleges the banks suppressed the rate by making artificially-lower interest rate submissions to Thomson Reuters, which calculates the CDOR daily.
The court filing also says that suppression increased their profits from CDOR-based derivative positions.
Scotiabank, RBC, National Bank of Canada, and CIBC declined to comment, and none of the remaining big six banks immediately responded to a request for comment.
None of the allegations have been proven in court.