Goldman Sachs Group Inc (NYSE:GS) has been slapped with a US$120mln penalty by a US derivatives regulator to resolve charges that it attempted to manipulate a global interest rate benchmark.
The case, brought by the Commodity Futures Trading Commission (CFTC) and involving a product known on Wall Street as ‘ISDAFIX’, was the latest in a series of investigations into manipulation of a variety of global benchmark rates by the big banks.
Goldman Sachs, which was also accused by the CFTC of making false reports on the rate, will settle the case without admitting or denying the charges.
Bank spokesman Michael DuVally said in a statement yesterday: “We are pleased to have resolved these matters and have already taken steps to enhance our policies and procedures."
To date, the CFTC has imposed penalties of over US $5bn stemming from its probes include products such as Libor and Euribor, foreign exchange benchmarks, as well as the US Dollar International Swaps and Derivatives Association Fix (ISDAFIX).
ISDAFIX rates are used to help value the cash settlement of options on interest rate swaps and other products.
Pension funds and local governments often rely on products priced off the benchmark rate to help hedge against future interest rate changes.
Goldman Sachs is the third bank to settle an ISDAFIX benchmark case with the CFTC. The other two were Barclays PLC (LON:BARC: in 2015 and Citigroup Inc (NYSE:C) in 2016.