The city of Philadelphia is the latest of a series of U.S. municipalities, following Houston a week ago, to sue some of the world’s biggest banks for financial losses incurred in the Libor interest-rate rigging scandal.
Philadelphia sued nine banks and several subsidiaries on Friday in Pennsylvania Federal Court, seeking punitive and other damages and claiming that the banks’ behavior “was nothing short of naked price-fixing”.
Other local governments – including Baltimore, and the California counties of San Diego and Sacramento – have also sued in connection with the scandal over manipulation of the London Interbank Offered Rate, or Libor.
The governments say that rate swap agreements that cities use to hedge borrowing costs were manipulated by the financial institutions to their own advantage.