The government has accepted the recommendations of Martin Wheatley’s independent review of LIBOR in full.

It will amend the Financial Services Bill, which is currently before Parliament. It will bring LIBOR activities within the scope of statutory regulation, including the submission and administration of LIBOR.

It will also create a new criminal offence for misleading statements in relation to benchmarks such as LIBOR, as well as amending the language of existing offences.

The government will also seek to provide the new Financial Conduct Authority (FCA) with a specific power to make rules requiring banks to submit to LIBOR, with reference to a Code of Practice produced by the rate administrator.

The administration believes that the current LIBOR administrator and the banks have to take responsibility for their failings and act upon Wheatley’s recommendations, including the removal and replacement of the British Banking Association (BBA) as operational LIBOR administrator. Baroness Hogg will now lead a panel that will identify an appropriate successor to the BBA.

“The government is determined to restore the credibility of LIBOR. That is why we have accepted Martin Wheatley’s recommendations in full and will begin the process of implementing them without delay,” said financial secretary to the Treasury, Greg Clark.

“The government’s changes to legislation will ensure that those that attempt to manipulate LIBOR face the full force of the law. But this is just one part of the process, the banks and the BBA will have to play their part to ensure that reform is effective and LIBOR’s reputation is restored.”