The Libor scandal primarily involved which of the following fraudulent actions?

The Libor scandal primarily revolved around the manipulation of interest rates, specifically the London Interbank Offered Rate (Libor). This rate serves as a benchmark for a wide range of financial products, influencing the cost of borrowing and the return on investments for trillions of dollars worldwide.

In this scandal, several banks were found to have submitted false or misleading rates to the panel that determines Libor, which allowed them to benefit financially from the artificial inflation or deflation of this key interest rate. Such manipulation not only affected financial markets but also undermined trust in the banking system, as it was discovered that some institutions engaged in collusion to boost their profits.

The other options—misreporting of company earnings, insider trading practices, and creation of false investment vehicles—refer to different types of financial misconduct but do not accurately encapsulate the core of the Libor scandal, which specifically involved the unethical practice of altering interest rate submissions for self-serving ends. This distinction is crucial in understanding the unique and widespread implications of the Libor scandal in the financial industry.