Barclays scandal engulfs industry

The banking industry has been engulfed in a fresh scandal after Barclays paid £290 million to settle claims that it used underhand tactics to try to rig financial markets.

The penalties from UK and US regulators, including a record £59.5 million fine from the Financial Services Authority (FSA), followed allegations it manipulated Libor and Euribor interbank lending, which govern the rates at which banks are prepared to lend to each other in the wholesale money markets.