Home Business and Technology Barclays among banks fined over Forex rigging cartels

Barclays among banks fined over Forex rigging cartels

Barclays

Swiss competition authorities said on Thursday they had fined five large banks some $90-million for collusion in foreign exchange trading, following steep fines recently imposed by Brussels.

Barclays, Citigroup, JPMorgan, Japan’s MUFG Bank and Royal Bank of Scotland (RBS) were hit with fines totalling around 90 million Swiss francs ($90.5 million, 80,6-million euros) after determining that the banks’ traders had colluded to fix exchange rates using chat rooms, the Swiss Competition Commission (COMCO) said.

The commission said Swiss banking giant UBS was not fined since it first revealed the collusion to the authorities.

“Traders of several internationally active banks have partially coordinated their conduct in two separate cartels,” COMCO said in a statement, adding that they had fixed rates for a range of currencies, including US dollars, euros, British pounds and Swiss francs.

The first cartel was dubbed the “Three-way banana split” — after the name of the online chat forum where the traders exchanged information — and involved Barclays, Citigroup, JPMorgan, RBS and UBS. It ran from 2007 to 2013, COMCO said.

The second cartel was known as “Essex Express”, since all of the traders involved except one lived in the county to the east of London and commuted on the same train. It involved Barclays, RBS, UBS and MUFG Bank, and ran from 2009 through 2012.

COMCO slapped Citigroup with the biggest fine, amounting to 28,5-million Swiss francs, followed by Barclays with 27-million francs and RBS 22.5 million.

JPMorgan meanwhile received a 9,5-million-franc fine, and MUFG Bank 1,5 million.

COMCO said that the penalties could have been higher, but that some of the banks agreed to cooperate with the commission and had “benefited from the leniency programme resulting in a reduction of the fine”.

The regulation authority said it was continuing its investigation into Credit Suisse and that it had closed other probes against Julius Baer and Zurcher Kantonalbank.

Last month, the European Commission sanctioned the same banks more than $1-billion for the same offence.

Also in that case, UBS got away without a fine, since it was the first to reveal the cartel activity to the authorities.

Source: eNCA

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