Investigation into the management of the Libor Fund

7 Sep 2017 01:20 PM

The National Audit Office has today published the findings of its investigation into the management of the Libor Fund. Following an international investigation by financial regulators in 2012, it was revealed that several banks in the US and the EU were manipulating Libor, a benchmark interest rate for inter-bank loans, for profit. UK regulators fined the banks £688 million. It was announced that all proceeds would “go to the benefit of the public”.

In 2015, an additional £284 million fine for manipulating foreign exchange markets was added to the Libor Fund, bringing the total amount allocated to the fund to £973 million. Parliament and the media have questioned the transparency of how the money from the fines is being distributed. The NAO investigation sets out how the government has distributed this money.

The key findings of the investigation are as follows:

Key facts

£973m – fines collected by the Financial Conduct Authority (FCA) committed to the Libor fund

£773m – amount assigned to be granted to charities and good causes by HM Treasury and the Ministry of Defence

£200m – Amount given to the Department for Education to spend on 50,000 apprenticeships

£40m – Amount remaining from Libor fines yet to be committed through any scheme

£141 million – Amounted committed to the Covenant Fund from Libor fines that is yet to be spent

Notes for Editors

  1. The NAO conducts investigations to establish the underlying facts in circumstances where concerns have been raised with us, or in response to intelligence that we have gathered through our wider work.
  2. Press notices and reports are available from the date of publication on the NAO website. Hard copies can be obtained by using the relevant links on our website.
  3. The National Audit Office scrutinises public spending for Parliament and is independent of government. The Comptroller and Auditor General (C&AG), Sir Amyas Morse KCB, is an Officer of the House of Commons and leads the NAO. The C&AG certifies the accounts of all government departments and many other public sector bodies. He has statutory authority to examine and report to Parliament on whether departments and the bodies they fund have used their resources efficiently, effectively, and with economy. Our studies evaluate the value for money of public spending, nationally and locally. Our recommendations and reports on good practice help government improve public services. Our work led to audited savings of £734 million in 2016.

All enquiries to:

Sam.roach@nao.gsi.gov.uk

020 7798 7199

0789 669 0607