The Daily Telegraph has learnt that the US crime fighting agency is working alongside regulators including the US Commodity Futures Trading Commission and the Securities and Exchange Commission.
The UK equivalent, the Serious Fraud Office, has revealed it is also taking an active interest. A spokesman said: "We are taking an interest in these matters and stand ready to help the US authorities with their investigations."
Lloyds Banking Group, Barclays, Royal Bank of Scotland and Swiss bank UBS have all revealed they are part of the investigation. Insiders believe another 10 banks may be involved.
The allegations centre on concerns that the interbank lending rate, Libor, was manipulated at the height of the financial crisis to lower borrowing costs artificially.
The British Banking Association is responsible for setting Libor. The daily rate is set by a panel of 16 banks in a number of currencies. It defines the benchmark rate at which banks lend to each other.
Libor rose alarmingly on a number of occasions during the crisis but never got out of control. Although banks have refused to comment on the investigations, senior figures within the industry have speculated that the way the market is constructed means manipulation would be possible.
One senior banker said: "If you ask whether the system is being manipulated you have to answer three things: do the banks have the means, motive and opportunity to do this? I would argue the answer to the first two is yes, which leaves you with opportunity and you have to make your own mind up about that."
The revelation that the FBI is involved in the Libor investigation opens the possibility that US authorities think there could be criminal charges to answer. The SFO is known to hold regular meetings with its larger US counterpart and could be brought into the investigation.
Key issues in the inquiry will be whether managers pressurised the currency traders that set Libor to manipulate the daily rates.
Investigators have already interviewed staff at several banks as they study whether they could have manipulated the Libor borrowing rate.
source: FBI joins inquiry into Libor manipulation claims against banks - Telegraph
