السبت , يونيو 13 2020

Big banks agree $2bn forex settlement

Man reflected in an electronic board

Nine banks have agreed to pay $2bn (£1.3bn) in settlements to US investors over claims they rigged foreign exchange rates, according to lawyers.

They are taking action on behalf of investors, including hedge funds and pension funds, who accuse banks of conspiring to manipulate rates.

The banks include HSBC, Barclays, BNP Paribas, Bank of America, JP Morgan, Citibank, Goldman Sachs, RBS and UBS.

Lawyer Michael Hausfeld said this was just the start.

Seven other banks are also being pursued and Mr Hausfeld added that the firm was also considering “concerted” action in London and Asia.

“While the recoveries here are tremendous, they are just the beginning,” he said.

“Investors around the world should take note of the significant recoveries secured in the United States and recognize that these settlements cover a fraction of the world’s largest financial market.”

‘Bandits’ Club’

Traders used their banks’ closed chat rooms, instant messaging systems and emails to manipulate prices.

Using the kind of colourful language typical in the spate of market rigging cases involving the banks, traders assumed names such as “The Cartel,” “The Bandits’ Club,” and “The Mafia” to communicate and place confidential orders.

Many of the world’s leading banks have paid hefty fines for fixing rates in the £5.5 trillion a day currency trading markets.

In May, US and UK regulators ordered $6 billion in fines on six major banks for rigging the foreign exchange market and Libor interest rates.

The agreements, which have not been broken down into the amounts individual banks will pay, are preliminary and need to be agreed by the district judge.

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