Goldman Sachs agrees to settle the ISDAfix rate-rigging case for $56.5m

Goldman Sachs Group has agreed to pay $56.5m (£45m) to settle a rate-rigging case that named more than a dozen other global lenders. A US class action lawsuit accused the lenders of manipulating the "ISDAfix" benchmark, which is used in the $553tn derivatives market, between at least 2009 and 2012.

According to the papers filed in federal court in Manhattan on Friday (16 December), Goldman Sachs has also agreed to help the plaintiffs' lawyers in pursuing the case against some banks who are yet to settle the case. Some seven banks named in the case had already agreed in May to pay a combined $324m to resolve the litigation.

The lawsuit was reportedly filed by a group of pension funds and municipalities, who accused 14 international banking groups of conspiring to rig the benchmark rate to reap personal benefits. The ISDAfix rates are used by investors for price swaps transactions, commercial real estate mortgages and structured debt securities.

The lawsuit also alleged that the lenders executed rapid trades before setting the rates every day and delayed trades to move the rates at positions they desired. The banks were also accused of posting misleading rates that did not reflect the actual market activities, Reuters reported.

Before Goldman Sachs, JPMorgan Chase & Co, Bank of America Corp, Credit Suisse Group AG and Deutsche Bank AG are among the banks who have settled the case. The US Commodity Futures Trading Commission has also secured settlements of $115m with Barclays Plc in May 2015 and $250m with Citigroup Inc in May 2016.

Lawyers for the plaintiffs said that BNP Paribas SA, HSBC Holdings Plc, Morgan Stanley, Nomura Holdings Inc, UBS AG, Wells Fargo & Co and ICAP Plc are among the lenders who have not resolved the litigation yet. Goldman Sachs has agreed to provide the plaintiffs' lawyers with evidence of rigging the benchmark interest rates like transaction data, documents and witness interviews to help them pursue their case against these banks.

Goldman Sachs and its lawyers did not immediately respond to a request late on Friday from Reuters for comment on the issue.