Brussels, 10/10/2012 (Agence Europe) - Financial players who falsify the books and carry out other abuse of the market should soon be sentenced to at least five years in prison for the most serious offences, argues the European Parliament's Economic and Monetary Affairs Committee on 9 October as it endorsed a draft report by British MEP Arlene McCarthy (S&D, UK) on revision of EU Directive (2003/6/EC) on abuse of the market in order to prevent fraudsters and scammers from shopping around and doing business in countries where such crimes are treated most leniently. The MEPs want it to be made possible to name and shame those responsible except where this would damage ongoing investigations. The Parliament hopes to reach agreement rapidly with the member states so that the new rules are endorsed by the Parliament plenary in December and come into force by the end of 2013.
“The EU must not be seen to be the soft option or a safe haven for perpetrators of market abuse,” said McCarthy, adding: “The Libor scandal has demonstrated that the culture in the financial sector has not changed and that they cannot be trusted to self-regulate.” In July, the European Commission amended its draft legislation to make manipulation of financial benchmarks a crime, following the LIBOR inter-bank interest rate falsification scandal in the City of London (see EUROPE 10663). Wolf Klinz (ADLE, Germany) said the report voted through by the MEPs “sends a clear signal that any attempts to abuse or manipulate benchmarks will not remain unpunished.“
MEPs say the exchange of information is needed among national authorities and new surveillance bodies need to be set up by the member states with the power to seize documents and potential evidence.
During the vote, MEPs learned that a petition of citizen's initiative Avaaz has received more than 720,000 signatures calling for tougher action against financial wheelers and dealers guilty of market abuse. Avaaz praised the Parliament for ignoring lobbying by the banks and listening to their voters. An opinion poll by the YouGov institute says that 90% of those polled back the planned changes. (EL/transl.fl)