Swiss bank UBS has been fined $1.5 billion by the U.S. Department of Justice for manipulating a key interest rate that affects borrowing between banks.

But in the end, federal prosecutors decided not to press charges against any of UBS’ top executives, and instead indicted only two former traders on charges of conspiracy. In addition, a Japanese subsidiary pled guilty to wire fraud.

The fines were the result of the “Libor” scandal, named after the London Interbank Offered Rate, which impacts how much money one bank loans to another.

UBS was accused of distorting some benchmark interest rates in an effort to boost financial gains.

Prior to the UBS decision, Barclays was penalized $450 million for Libor-fixing manipulations. That bank’s chairman, chief executive, and chief operating officer all resigned in the wake of the controversy.

When asked why the Justice Department chose to not prosecute any UBS executives, Criminal Division chief Lanny Breuer told reporters:

“We looked at the conduct. There are many factors, as you know, that we consider when pursuing cases against entities. Here much of the conduct occurred at the Japanese subsidiary, and looking at its criminal history, looking at the severity of the conduct, looking at the collateral consequences, we think we arrived at a very robust, very real and very appropriate resolution…. Our goal here is not to destroy a major financial institution.”

The Guardian newspaper in Britain thought otherwise.

“The official answer so far to misconduct has been chasing a few bad apples and fining the banks that house them. That is no way near enough. The fines paid by Barclays and UBS seem almost like the costs of doing business–irksome, sure, but a punt worth making. It is surely time to talk about depriving major offenders of their licences to do some kinds of market activity. That may sound unduly punitive to some regulators, but consider: the Libor scandal is already proving to be one of the biggest in banking history–and it has only just begun to unravel,” wrote The Guardian in an editorial.

-Noel Brinkerhoff

To Learn More:

The UBS Libor-Fraud E-mails Are a Gift for Regulators (by Nick Summers, Bloomberg)

Lanny Breuer on UBS: Our Goal Here is Not to Destroy a Major Financial Institution (Corporate Crime Reporter)

UBS And The Libor Scandal: The Gift That Keeps Taking (editorial, The Guardian)

Statement of Facts (U.S. Department of Justice) (pdf)