The Justice Department's criminal division is mounting a case against several financial institutions and their employees over the manipulation of interest rates and expect to file charges with at least one bank later this year.

Traders at the British bank  Barclays will also be investigated and could face criminal prosecution even though the bank agreed settle with U.S. and U.K. bank officials for $450 million last month. 

The investigation by the Justice Department is just one act in a play that includes "private investor lawsuits and a sweeping regulatory inquiry led by the Commodity Futures Trading Commission." 

The New York Times reports:

With civil actions, regulators can impose fines and force banks to overhaul their internal controls. But the Justice Department would wield an even more potent threat by bringing criminal fraud cases against traders and other employees. If found guilty, they could face jail time.

The civil and criminal actions is expected to cost the banking industry tens of billions of dollars.

 

For more of Neon Tommy's coverage on the Libor scandal, click here.

Reach Executive Producer Subrina Hudson here; follow her on Twitter here.