The LIBOR scandal was that most challenging of news stories: a confusing mess that seemed important, but was all-but-impossible for the average person to understand. In a nutshell, it involved a group of banks that together make decisions that set the rate at which banks lend money to other banks. In doing so, they basically determine the worldwide short-term interest rate, which in turn affects hundreds of trillions of dollars worth of financial products. In 2012, some of the banks were caught conspiring to manipulate the interest rate to get themselves better returns or to prop up their bottom lines.
Since LIBOR affects so many financial products, its influence on the average American's wallet is literally immeasurable: pensions, securities, retirement accounts, and a stunning array of other investments are tied to LIBOR, as are municipal investments, which can affect almost every aspect of daily life. This latter consideration gives a glimpse at the LIBOR scandal's overall effect: According to Bloomberg, the rate's manipulation cost American municipalities at least $4 billion -- which works out to an average of $13.33 for every man, woman and child in the U.S.