Five major banks will pay fines totaling billions of dollars for rigging the foreign exchange market in a settlement expected to be unveiled Wednesday by US and British regulators.
Penalities will range from the hundreds of millions of dollars to $1 billion or more, depending on a bank's involvement in the scheme, according to people familiar with the talks.
The banks are American giants JPMorgan Chase and Citigroup, British banks Barclays and Royal Bank of Scotland, and UBS of Switzerland.
The steep penalties are expected from Britain's Financial Conduct Authority, the US Department of Justice, the US Federal Reserve, the US Commodity Futures Trading Commission and the New York Department of Financial Services.
Regulators have accused the banks of conspiring to manipulate the $5.3-trillion-per-day foreign exchange market in ways that cheated clients and bolstered their own profits.
Traders used instant messages and online chats to share information about clients and plot trades.
Barclays is expected to be hit with possibly the largest fine after it was left out of a $3.2 billion settlement that the other four banks, along with HSBC, already reached last November with the FCA and the CFTC over forex market manipulation.
Barclays on April 29 announced it had aside an additional £800 million ($1.24 billion) for the foreign exchange case, taking the group's total provision on the matter to £2.05 billion ($3.1 billion.)
At least four of five banks in Wednesday's agreement are expected to plead guilty to a US criminal antitrust charge: JPMorgan, Citigroup, Barclays and RBS.
UBS could also end up on that list. The bank had initially expected to win immunity from prosecution for cooperating with US officials on the probe.
However, according to people familiar with the matter, because UBS was involved in forex manipulation, Justice Department officials have now withdrawn a 2012 deferred prosecution agreement with the bank over its role in a separate international banking scandal, for manipulating the global benchmark interest rate, LIBOR.
A guilty plea typically restricts a bank's operations in the US, but regulators have been working on waivers to ensure customers are not harmed, according to people familiar with the matter.