Regulators fined six major banks including Citigroup and UBS a total of $4.3 billion for failing to stop traders from trying to manipulate the foreign exchange market, following a year-long global investigation.
HSBC, Royal Bank of Scotland, JP Morgan and Bank of America also face penalties resulting from the inquiry that has put the largely unregulated $5 trillion-a-day market on a tighter leash, accelerated the push to automate trading and ensnared the Bank of England.
In the latest scandal to hit the financial services industry, dealers shared confidential information about client orders and coordinated trades to make money from a foreign exchange benchmark used by asset managers and corporate treasurers to value their holdings. Dozens of traders have been fired or suspended
Dealers used code names to identify clients without naming them and created online chatrooms with pseudonyms such as “the players”, “the 3 musketeers” and “1 team, 1 dream” in which to swap information. Those not involved were belittled and traders used obscene language to congratulate themselves on quick profits made from their scams.
Britain’s Financial Conduct Authority (FCA) fined five lenders $1.77 billion, the biggest penalty in the history of the City of London, and the US Commodity Futures Trading Commission (CFTC) ordered them to pay a further $1.48 billion.
The US Office of the Comptroller of the Currency, which regulates banks, also fined the US lenders $950 million and was the only authority to penalise Bank of America.
📣 The Indian Express is now on Telegram. Click here to join our channel (@indianexpress) and stay updated with the latest headlines