THERE was more trouble sourced to historic problems for RBS yesterday when a former trader with the Edinburgh-based bank was fined £250,000 and banned from the financial services industry.

Interest rate derivatives trader Neil Danziger received the punishment from the Financial Conduct Authority (FCA) for his activities during the Libor rate-fixing scandal.

According to the FCA statement yesterday, Danziger formerly worked at state-owned RBS trading products referenced to Japanese yen (JPY) Libor. In addition, on occasion, he made RBS’s JPY Libor submissions to the British Bankers Association (BBA) when RBS’s primary submitters were not available.

The statement added: “The FCA has found that Mr Danziger was knowingly concerned in RBS’s failure to observe proper standards of market conduct and has determined that he is not a fit and proper person because he acted recklessly and lacks integrity.”

Mark Steward, executive director of enforcement and market oversight at the FCA said: “Proper standards of market conduct reflect the interests of the whole community in the well-being of our financial markets. Mr Danziger’s reckless disregard of these standards has no place in the financial services industry.

“Market participants cannot turn a blind eye to what the community, through its laws and regulations, expects nor apply their own, lower standards. This substantial fine and ban should reinforce that message.”

The FCA found that between February 14, 2007 and November 22, 2010, Danziger routinely made requests to RBS’s primary submitters, intending to benefit the trading positions for which he and other derivatives traders were responsible. He took those trading positions into account when acting as a substitute submitter and on two occasions, obtained a broker’s assistance to attempt to manipulate the JPY Libor submissions of other banks.

In addition, between September 19, 2008 and August 25, 2009, Danziger entered into 28 wash trades – risk free trades, with the same party, in pairs that cancelled each other out and for which there was no legitimate commercial rationale. The FCA stated that the purpose of these was to make or facilitate brokerage payments to two firms of brokers in recognition of his receipt of personal hospitality.

The FCA found he acted recklessly, and therefore with a lack of integrity, in deliberately closing his mind to the risk that his actions were improper.

On June 18, 2014, the FCA issued Danziger with a warning notice, but proceedings were stayed due to the ongoing criminal investigation by the Serious Fraud Office into certain individuals who formerly worked at RBS. The statement concluded: “Today’s fine and ban reflect the FCA’s commitment to protect the integrity of the UK financial system.”

A lawyer who has represented Danziger said that the former trader, who was first interviewed by regulators in 2012, is a scapegoat for the “systemic problems relating to Libor”.