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Accounting Assignment Question
Accounting Assignment Solution
The first ethical issue is that LIBOR (London Interbank Offered Rate) and its members have not followed the transparency while dealing with their customers. They manipulate the rates according to their financial situation. The motto of LIBOR was to promote the fair practices in the financial market for loans and borrowings between banks all around the world. However, LIBOR got stuck in the scandal where banks were manipulating the rates for their own benefits.
The second ethical issue is that LIBOR and its administration didn’t pay attention to the working of banks and just take the activities casually. It is a major ethical aspect that the money of investors and customers should be dealt with utmost care and need to be handled in a painstaking manner (The LIBOR scandal: The rotten heart of finance, 2012). LIBOR neglects their major duty and responsibility just to pass the benefits to banks. It can be treated as breaching the law and rule and regulations framed for the legal functioning of the financial market.
At last the third and worst ethical issue that has been identified is related to working with self-interest and greed. LIBOR ditched their main motto behind the existence and just ignore all the parameters that can help in ensuring the financial stability and sustainability in the market. Banks like the Bank of England, Barclay’s bank work for their self-interest. On the contrary, the regulators like Financial Services Authority (FSA) in the UK, the US Commodity Futures Trading Commission (CFTC) and the US Department of Justice also neglect their duties which are highly unethical and illegal too (Tourvalai, 2012).
Therefore these three kinds of ethical issues (manipulation in rates, breaching the law, working for self-interest) have been witnessed in the given case study……………….