Corporate regulator Greg Medcraft has hit back at claims by Westpac Banking Corp and ANZ Banking Group the regulator's rate-rigging case fundamentally misunderstands the money markets and warned it is not a victimless crime.

ANZ claim the Australian Securities and Investments Commission case is "based on a misunderstanding of how bank bill issuance and interest rate risk management operates" and Westpac CEO Brian Hartzer told staff on Tuesday that he disagreed with ASIC's "assessment of trading activity given the complexity of strategies involved".