Dozens of states, cities and other government entities are exploring whether they lost money because of the alleged manipulation of a crucial benchmark used to set interest rates on hundreds of trillions of dollars worth of loans and investments, the Washington Post reported today. Baltimore City is leading a federal lawsuit against the group of big banks that set Libor, the London interbank offered rate (Libor), accusing it of conspiring to suppress the benchmark. The banks named in the case include JPMorgan Chase, Bank of America, Barclays, CitiBank and Deutsche Bank. In a lawsuit filed in federal court in Manhattan, Baltimore said the banks kept Libor artificially low during the financial crisis and its immediate aftermath, robbing the city of millions of dollars in returns on investments such as interest-rate swaps.
