Rate-fixing bankers should be treated as criminals, the European Commission said on Wednesday.
That is the view of the EU’s executive amid public anger over the Libor rate scandal.
Barclays admits its staff manipulated Libor, a key lending rate between banks, and has paid a 370 million euro fine.
US prosecutors are investigating the alleged wrongdoers, but existing insider dealing laws on this side of the Atlantic do not cover such an offence in terms of individual criminal liability.
That has to change, said Internal Market Commissioner Michel Barnier: “Judges should have the means to punish them without any leniency. The worst offenders should go to prison,” he told reporters in Brussels.
The Commission is also mulling whether the EU should take over supervision of market benchmarks, stripping banks of their powers of self-regulation.
A number of banks are also accused of rigging the Libor’s Eurozone counterpart, Euribor, which is overseen by the European Banking Federation.
Florence Ranson, a spokeswoman for the group, said she thought it was unlikely there had been any foul play.
“If there has been maniuplation or attempted manipulation of Libor, there could also been with Euribor. We have 43 members and we think that to fix the rate would be a difficult thing to coordinate with 43 different banks,” she told euronews in an interview.
The Commission’s proposals need the approval of the European Parliament and national governments before they can become law.