European Commissioners are set to make interest rate rigging a criminal offence after the LIBOR scandal, according to reports.
Amendments to the Market Abuse Directive, set to be announced on Wednesday, are expected to state anyone caught manipulating the markets will be jailed.
The Independent reported the announcement is likely to come from Commission President Jose Manuel Barroso and financial services commissioner Michel Barnier.
The report said the FInancial Services Authority and Serious Fraud Office have appeared "toothless" over the LIBOR scandal, despite the record fine levied on Barclays.
FSA chief Lord Turner is expected to make a hard-hitting speech attacking the City's 'debased' culture on Tuesday.
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