Arab Today, arab today 5 banks hit with 32bn fines over forex rigging
Last Updated : GMT 08:53:10
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5 banks hit with $3.2bn fines over forex rigging

Arab Today, arab today

Arab Today, arab today 5 banks hit with $3.2bn fines over forex rigging

Britain's Financial Conduct Authority on Wednesday
London -AFP

Global regulators announced Wednesday $3.2 billion (2.5 billion euros) in fines against five major US and European banks over allegations of rigging in foreign exchange markets.
The hefty fines, announced in London, Washington and Zurich, follow a worldwide probe into the scandal surrounding the £3-trillion-a-day forex market.
British banks HSBC and Royal Bank of Scotland (RBS), US groups Citibank and JPMorgan Chase, and Swiss bank UBS have all been fined by Britain's Financial Conduct Authority (FCA) and the US Commodity Futures Trading Commission (CFTC), the pair said in a statement.
The FCA hit the five banking giants with a total penalty of £1.1 billion ($1.7 billion, 1.4 billion euros), while the CFTC has fined them $1.4 billion over the same matter.
In addition, the Swiss Financial Market Supervisory Authority (FINMA) announced a $139-million settlement with UBS.
"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," it 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."
British lender Barclays was not included in the settlements but the bank added separately that it continued to hold talks with regulators.
The FCA said that, between January 1, 2008 and October 15, 2013, it found that "ineffective controls" at the five banks allowed their G10 foreign exchange traders "to put their banks' interests ahead of those of their clients, other market participants and the wider UK financial system".
It added: "The banks failed to manage obvious risks around confidentiality, conflicts of interest and trading conduct."
"These failings allowed traders at those Banks to behave unacceptably. They shared information about clients' activities which they had been trusted to keep confidential and attempted to manipulate G10 spot FX currency rates, including in collusion with traders at other firms, in a way that could disadvantage those clients and the market."
The CFTC meanwhile announced in a separate statement that the five banks were being punished for "attempted manipulation of, and for aiding and abetting other banks' attempts to manipulate, global foreign exchange benchmark rates to benefit the positions of certain traders."
News of the fines was welcomed by the British government.
"Today we take tough action to clean up corruption by a few so that we have a financial system that works for everyone," said finance minister George Osborne.
"It's part of a long-term plan that is fixing what went wrong in Britain's banks and our economy.
"A number of traders have been suspended or fired, and the Serious Fraud Office are conducting criminal investigations.
"The banks that employed them face big fines -- and I will ensure that these fines are used for the wider public good."
The total FCA fine is a record amount and eclipses the £532 million penalty it handed down to banks and brokers over the 2012 Libor interbank rate-rigging scandal.

 

 

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