U.S. regulator: It's time to change LIBOR system

A trader pauses in front of the New York Stock Exchange on June 15, 2012 in New York City. (Credit: Spencer Platt/Getty Images) Spencer Platt/Getty Images

(AP) WASHINGTON - A top U.S. regulator is calling for an overhaul of a key global interest rate, saying consumers need more confidence that the rate is set honestly and transparently.

Gary Gensler, chairman of the Commodity Futures Trading Commission, told a European Parliament committee Monday that the process for setting London Interbank Offered Rate, or LIBOR, should change.

Gensler's remarks come months after Britain's Barclays bank admitted that it had submitted false information for LIBOR. Barclays (BARC) agreed to pay a $453 million fine in settlements with the CFTC, U.S. prosecutors and British regulators.

A British banking trade group sets the LIBOR every morning after international banks submit estimates of what it costs them to borrow. The rate affects trillions of dollars in contracts around the world, including mortgages, bonds and consumer loans.

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