Tuesday, July 17, 2012

Will The MTA Sue Barclays Bank Over LIBOR Rate Manipulation Scandal? MTA Says It Will “Vigorously Pursue All Available Legal Actions”

In follow-up to my story* about which state and city agencies and governments will possibly be suing Barclays Bank in connection with the LIBOR interest rate manipulation scandal and mentioning a long list that are possibilities it is interesting to note that, when contacted, the MTA being on the ball had already given some thought to this subject, enough to have a statement prepared and ready in advance.

(* See: Saturday, July 14, 2012, Will The Empire State Development Corporation (ESD), The MTA, NYC And New York State Sue Barclays Bank?)

Here is the MTA’s comment from MTA Media Liaison Aaron Donovan:
“The MTA has asked its legal counsel to review its options in relation to the LIBOR scandal, and will vigorously pursue all available legal actions. We are outraged about the apparent market manipulation, and will always do everything possible to protect the MTA.”
I have asked the MTA a series of follow-up questions, mostly susceptible to simple YES/NO responses. I will supply readers with the MTA’s response as soon as appropriate. If you want more information about why the MTA and other New York governments might be suing Barclays(like Baltimore and other municipalities around the nation are) for its fraudulent rate manipulation it is spelled out in bullet points in my prior article on this subject.

But there is irony here: As I noted in my original article:
If the MTA sues Barclays it will be suing the bank for which it decided it should name two major New York City subway system stations in Brooklyn (virtually for free, agreeing to take back on the public’s behalf a paltry below-market “$200,000 per year,” a shameful deal locked in for twenty years).
I have also made similar inquiries to other government agencies which probably have reason to sue Barclays (there are quite a few) and am in the process of putting these inquiries to still more. One agency that has yet to provide any response is the New York City Housing Development Corporation (HDC) which, tomorrow, Wednesday at 1:00 PM, is holding a hearing on the first issuance of bonds for the Atlantic Yards mega-monopoly since the issuance of bonds for the Ratner/Prokhorov (“Barclays”) basketball arena. A prompt response from HDC would surely be relevant to that hearing. The Hearing is at 110 William Street. For more information click on the link.

Is HDC, like the MTA, looking at vigorously pursuing “all available legal actions” against Barclays to protect HDC and New York taxpayers? As noted in my prior article, HDC is looking at issuing tax exempt bonds for a building that will, after all, share walls and infrastructure with the Ratner/Prokhorov “Barclays” arena. Should we also say that it will share reputation or disrepute with the arena?

The HDC hearing tomorrow is a key event for one of the few discretionary governmental approvals being exercised for the Atlantic Yards megadevelopment and an important precedent-setting moment. The Barclays arena bonds were relatively unique but this will be the first set of bonds (with a sizable accompanying amount of new subsidy for Ratner) for the entire rest of the mega-project, going a long way to set the precedent for any and all remaining discretionary approvals yet to come.

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