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Lawsuit Over Key Interest Rate Increases Pressure on Treasury for Fixes

Statement

By:
Date:
Location: Washington, DC

Sen. Chuck Grassley of Iowa and Sen. Mark Kirk of Illinois today made the following comment on Freddie Mac's lawsuit over a rigged interest rate that affects interest rates on mortgages, student loans, credit cards and other loans. Grassley and Kirk have questioned the Treasury Department's slow response to the rigging of the London interbank offered rate, or LIBOR, since last October.

"On October 2, 2012, we raised concerns with the Treasury Department that lawsuits related to LIBOR would clog the courts and cost billions of dollars. Freddie Mac's LIBOR lawsuit will likely take years to adjudicate and appears to show that U.S. taxpayers paid billions of dollars extra as a result of LIBOR manipulation. In fact, even though we raised this issue almost six months ago, the Treasury Department still appears not to have taken a single concrete step to reform or replace LIBOR. Given this latest lawsuit, the pressure continues for Treasury to effectively address this problem. Until Treasury acts, we will continue to press Treasury for a transparent and accountable interest rate that Americans can trust."


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