Citigroup, JPMorgan to pay $182.5 million to settle rate-fixing case

By Jonathan Stempel

NEW YORK (Reuters) – Citigroup Inc and JPMorgan Chase & Co. will pay $182.5m (£142.01m) to settle a lawsuit with US investors who accuse them of breaking antitrust laws by colluding with other banks to manipulate a key European interest rate benchmark.

A preliminary settlement over alleged manipulation of the Euribor (European Interbank Offered Rate) by banks was filed Wednesday evening in the U.S. District Court in Manhattan. The settlement application must be approved by a judge.

Five banks have reached settlements in this case for $491.5 million, including a previous settlement of $170 million with Deutsche Bank AG $94 million deal with Barclays Plc and $45 million with HSBC Holdings Plc .

Euribor is the euro-denominated equivalent of LIBOR, which is the benchmark for setting rates on credit cards, student loans, mortgages and other debt worth hundreds of trillions of dollars.

Investors, including the California State Teachers’ Retirement System (CalSTRS), accused the banks of manipulating the Euribor rate and fixing the prices of derivatives based on that rate between June 2005 and March 2011 in order to make profits at the banks’ expense.

Under the settlement agreement, Citigroup and JPMorgan denied wrongdoing and settled to avoid the expense and distraction of litigation. Several banks remain defendants.

Citigroup spokeswoman Danielle Romero-Apsilos and JPMorgan spokeswoman Tasha Pelio declined to comment Friday. Vincent Briganti, a lawyer for the plaintiffs, also declined to comment.

Many of the lawsuits in Manhattan court seek to hold banks accountable for alleged manipulation of interest rates, commodities, currencies and other financial markets.

JPMorgan this week reached a separate $7 million settlement over investor claims that it conspired with rivals to rig the Australian Bank Bill Swap Reference Rate, becoming the first bank to settle the dispute. The same law firms represented investors in that case and in the Euribor case.

The case is Sullivan et al. v. Barclays Plc et al., U.S. District Court, Southern District of New York, No. 13-02811.

(Reporting by Jonathan Stempel in New York; Editing by Susan Thomas)