LONDON – The British brokerage firm Tullett Prebon Group said on Friday that it was facing a regulatory investigation over trades made by two former employees.
Tullett Prebon said the by the Financial Conduct Authority was conducting an inquiry into purported “wash” trades, transactions that are considered risk free and conducted simply to generate commissions.
The brokerage firm said one of the former employees is Noel Cryan, who is facing separate criminal proceedings by the Serious Fraud Office of Britain in an investigation into potential manipulation of the London interbank offered rate, or Libor, a global benchmark interest rate.
Mr. Cryan is expected to appear in court for the first time related to the Libor inquiry this month. He was terminated by Tullett Prebon last year and sued the company over his dismissal.
“As part of this investigation the company continues to cooperate with regulators and government agencies,” Tullett Prebon said in a news release.
The brokerage firm said that it had been asked to provide information to the F.C.A. and other government agencies in connection with their inquiries into Libor and “is cooperating fully with those requests.”
Mr. Cryan is the 13th former employee of a bank or brokerage firm to face criminal charges in Britain related to manipulation of the Libor, one of the main rates used to determine the borrowing costs for trillions of dollars in loans. The authorities in the United States have also brought criminal charges against several of the people charged in Britain.
The first criminal trial in the inquiry is expected to begin in Britain in May. Since it first emerged publicly in 2012, the Libor scandal has engulfed some of the world’s largest banks and tarnished the reputations of many of Britain’s leading lenders.
To set Libor and other rates, banks submit the rates at which they would be prepared to lend money to one another, on an unsecured basis, in various currencies and at varying maturities. Investigations have found evidence in the last two years that traders at various banks benefited from falsely reported rates.
The resulting scandal has also set off a call for reform in how other benchmarks are set, including the rates for currencies and precious metals.
British prosecutors and the Serious Fraud Office have said they have identified as many as 22 people as potential co-conspirators in the investigation, but they have named only the 13 people criminally charged.