The Justice Department is conducting a criminal probe into whether the world's biggest banks manipulated a global benchmark rate, according to a person familiar with the situation.

While the Justice Department's inquiry into how the London interbank offered rate, or Libor, is set had been known, the criminal aspect of the probe was not.

A criminal inquiry underscores the serious nature of a worldwide investigation that includes regulators and law-enforcement agencies in the United States, Japan, Canada and the UK.

A Justice Department spokeswoman declined to comment.

Libor is set everyday in London for 10 currencies for a range of maturities. The rate is supposed to reflect the rate at which banks lend to one another. Dollar Libor, for example, is calculated after 18 banks submit the costs to borrow dollars.

The investigations are examining whether traders at the banks tried to influence whether the rate went up or down. A change in the rate could produce tens of millions of dollars if a trader has bet correctly on the direction of Libor.

A number of big banks have disclosed in regulatory filings that the Justice Department was investigating the matter.

Swiss bank UBS AG is playing a key role in the probes because it agreed to come forward and cooperate in the inquiries.

The bank said in a regulatory filing it has been granted conditional leniency or conditional immunity by the antitrust division of the Justice Department and the Swiss Competition Commission.

(Reporting By Carrick Mollenkamp; Editing by Gary Hill and Tim Dobbyn)