(Corrects June 26 story to make clear allegation of manipulation came from regulators)
LONDON, July 4 (Reuters) - A senior executive at British brokerage firm ICAP PLC knew of an arrangement with UBS AG that U.S. and British regulators allege was part of a scheme to manipulate benchmark interest rates, according to the Wall Street Journal, which cited sources familiar with the matter.
The executive, David Casterton, was included in some emails sent in 2007 documenting the discussions, in which UBS agreed to make quarterly payments to ICAP for help in rigging the London Interbank Offered Rate, or LIBOR, the paper said on its website on Wednesday.
A call and email to ICAP spokeswoman Brigitte Trafford were not immediately returned after business hours.
The rate-fixing scandal has infected many of the world's biggest banks, put in motion new attempts to set global interest rates and indirectly led to the departure of several top executives at Barclays PLC (BARC.L) and UBS.
Casterton, who the paper said is a longtime deputy to ICAP Chief Executive Michael Spencer and currently head of global broking at the London-based firm, would nevertheless be one of the most senior executives affected by the Libor scandal, the Journal said.
An ICAP spokeswoman told the paper that no one at the company was "aware of any corrupt payment from any source at any time" and said it would be false and defamatory to suggest otherwise. (Reporting by Jed Horowitz; editing by Lisa Shumaker and Tom Pfeiffer)