The FCA is set to hit a banker involved in the Libor manipulation scandal with a £2.5m fine.
According to the Financial Times, the regulator – which has been investigating people in connection with the alleged manipulation of the benchmark rate – is preparing to levy heavy penalties for those involved in the scandal.
The largest fine issued to an individual by the regulator was £6m in 2011.
Earlier this month, the FCA published warning notices against two bankers for Libor manipulation, the first it had published since it was given the power to do so.
One of these bankers is set to be fined £2.5m, although this could be raised or lowered, reports the FT. The individual could then refer the matter to the Upper Tribunal.
The FCA said the first individual, who was a submitter at a bank, was knowingly involved in significant failings in relation to Libor by the bank over a period of two years.
It said the individual made interest rate benchmark submissions which took into account requests made by traders to benefit their positions and colluded directly with traders at another panel bank in an attempt to influence submissions.
The second warning notice was against a former manager at a bank who was knowingly involved in significant Libor failings over a period of more than three years.
The FCA said the individual was personally aware of and condoned traders making requests to submitters to manipulate interest rate benchmark submissions, and submitters making submissions which took those requests into account.
The individual was also responsible for the oversight and supervision of the bank’s submitters and some of the bank’s traders and failed to manage appropriately the business area for which he was responsible.
The FCA was given the power to publish early warning notices by the Financial Services Act 2012, with the aim of promoting early transparency of enforcement proceedings.