Six big banks hit with $4.2b forex rigging fines

FE Team | Published: November 14, 2014 00:00:00 | Updated: November 30, 2026 06:01:00

LONDON, Nov 13 (BSS/AFP): Global regulators announced yesterday $4.2 billion in fines against six major US and European banks for attempting to manipulate foreign exchange markets.
The hefty fines, unveiled in London, Washington and Zurich, follow a worldwide probe into the scandal over the $5.3-trillion-per-day forex market, around 40 percent of which takes place in the British capital.
British banks HSBC and Royal Bank of Scotland (RBS), US peers Citigroup and JPMorgan Chase, and Swiss lender UBS have all been fined by Britain's Financial Conduct Authority (FCA) and the US Commodity Futures Trading Commission (CFTC).
The FCA hit the five banking giants with a total penalty of £1.1 billion ($1.7 billion), while the CFTC has fined them $1.4 billion.
The Swiss Financial Market Supervisory Authority (FINMA) also announced a settlement of 134 million Swiss francs ($139 million) with UBS for the rigging misconduct.
And the US Office of the Comptroller of the Currency fined JPMorgan, Citigroup and Bank of America $950 million.
British bank Barclays-which was at the heart of the 2012 Libor rate-rigging affair-was not included in the forex settlements and remains under investigation.
A string of scandals, including Libor rigging and product mis-selling, has damaged the reputation of major banks, which also had helped to spark the 2008 global financial crisis that led to a worldwide recession.
"The Financial Conduct Authority has imposed fines totalling £1,114,918,000... on five banks for failing to control business practices in their G10 spot foreign exchange (FX) trading operations," the regulator said in a statement.
"The G10 spot FX market is a systemically important financial market. At the heart of today's action is our finding that the failings at these banks undermine confidence in the UK financial system and put its integrity at risk."
The FCA said that, between January 1, 2008 and October 15, 2013, it found that "ineffective controls" at the five banks allowed their G10 forex traders "to put their banks' interests ahead of those of their clients, other market participants and the wider UK financial system".
Traders at the different banks "formed tight-knit groups in which information was shared about client activity", it added.
The British regulator said traders used code to identify clients without naming them, such as "The 3 Musketeers", "The Players" and "The A-team".
"The banks failed to manage obvious risks around confidentiality, conflicts of interest and trading conduct," the FCA said.