The opposition Labour Party in the United Kingdom called for a new economic crime law this week to prevent future financial scandals like the Libor rate manipulation.
Yvette Cooper, Labour’s home-affairs spokeswoman, said that the proposed law would provide police and prosecutors with clarity and determine which agencies would tackle financial fraud, BusinessWeek reports.
“Look at the Libor scandal that emerged this summer,” Cooper said, BusinessWeek reports. “It is a multibillion-pound fraud. People were fiddling figures to get rich, while small businesses paid the price. Yet no one has been arrested.”
Last week, Financial Services Authority Managing Director Martin Wheatley called for oversight of the London interbank offered rate, or Libor, to be given to the U.K.’s financial regulator as part of a series of proposals to instill confidence in the blemished benchmark.
Barclays Plc, the second-largest lender in Britain, paid a record $468 million fine in June for its Libor manipulations. Libor is managed by the British Bankers’ Association and sets rates for more than $300 trillion of securities.
“Governance of Libor has completely failed,” Wheatley said, according to BusinessWeek. “This problem has been exacerbated by a lack of regulation and a comprehensive mechanism to punish those who manipulate the system.”