The Westpac Bank in Australia is facing legal action from the corporate regulator, The Australian Securities and Investments Commission, for alleged manipulation of benchmark interest rates.

The ASIC has initiated legal proceedings against the bank after being convinced that it resorted to market manipulation in a key interest rate benchmark, reports Sky News.

The ASIC, in a declaration filed in the Federal court, said the bank contravened sections of the Australian Securities and Investments Commission Act and the Corporations Act.

It also alleged that Westpac traded in a manner “intended to create an artificial price for bank bills” on 16 occasions. The bill swap reference rate, or BBSW, is a key interest rate metric for Australian financial markets.

According to ASIC, on April 6, 2010, and June 6, 2012, Westpac had “a large number of products which were priced or valued off BBSW and that it traded in the bank bill market with the intention of moving the BBSW higher or lower.”

The watchdog’s a statement blamed the bank for seeking to maximise profit or minimise loss to the detriment of those holding opposite positions to it.

However, Westpac dismissed ASIC’s allegations and said ASIC provided only “selected details” of one of the 16 instances.

“We reject the allegations made by ASIC and do not believe Westpac, or any employee, has acted unlawfully in relation to the instances detailed by ASIC,” Westpac’s group chief financial officer Peter King said.

It is the second Australian bank to be accused of bill swap rate manipulation by the ASIC. In February, ASIC filed a claim against ANZ alleging 44 counts of manipulation in BBSW rates.

The ASIC also singled out the managing director of Westpac treasury, Colin Roden, for the manipulation, reports The Australian.

If the claim is proved right, it could lead to fines of about $18 million against the bank. Other leading banks–the Commonwealth Bank and NAB, are also under ASIC scanner for alleged manipulation of interest rates.