Much like its big bank brethren, Commonwealth Bank of Australia (ASX: CBA) could also be in the firing line of the corporate watchdog regarding allegations of interest rate rigging.

Although there has been no official investigation launched into Australia’s biggest bank at this stage, The Australian Financial Review has reported that the bank is still bracing itself for a similar lawsuit to those being faced by its major rivals.

National Australia Bank Ltd. (ASX: NAB) confirmed on its website on Tuesday that it was now subject to an industry-wide bank bill swap rate investigation by the Australian Securities and Investments Commission.

The practices of Westpac Banking Corp (ASX: WBC) are also under investigation, as confirmed by ASIC in April, while it also has a case against Australia and New Zealand Banking Group (ASX: ANZ).

The investigations relate to allegations including market manipulation and unconscionable conduct which could potentially undermine the integrity of Australia’s financial markets. If the bank bill swap rate was rigged, it could have impacted the pricing of billions of dollars of loans across the economy, potentially undermining the confidence of participants in the system which can impact growth in the long-run.

As noted on NAB’s website, the allegations relate to trading in the bank bill swap rate (BBSW) market during the period 8 June 2010 to 24 December 2012. It is unclear how successful any claims against the banks on either market manipulation or unconscionable conduct will be, although class actions are a possibility.

At this point, an official investigation into Commonwealth Bank is yet to be launched and it remains unclear how a case against the bank is progressing.

These allegations are only one issue facing the country’s big four banks right now. After a string of record earnings results, growth in profits is now slowing across the board in light of heightened competition and, in some cases, higher bad debt charges.

Although the banks have long been regarded as being some of Australia’s greatest shares to hold, that belief has also been challenged more recently. This is partly due to the halt in dividend growth across the sector, together with fears of a potential slowdown in housing growth and a potential recession in Australia.

After all, it’s been almost a quarter of a century since our last recession. Although the banks’ share prices have fallen over the last 12 months or so, they are still not what you would call ‘cheap’ and are thus susceptible to a pullback in the economy.

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Motley Fool contributor Ryan Newman has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.