Citigroup Inc., Credit Suisse Group AG, Barclays Bank PLC, Deutsche Bank AG, JPMorgan Chase & Co., Royal Bank of Scotland Group PLC and UBS AG.
2015 Pay $5.4 billion for rigging currencies
Citigroup (C), Barclays (BCS), JP Morgan Chase (JPM), and Royal Bank of Scotland (RBSPF)were fined more than $2.5 billion by the U.S. after pleading guilty to conspiring to manipulate the price of dollars and euros. The four banks, plus UBS (UBS) , have also been fined $1.6 billion by the Federal Reserve, and Barclays will pay regulators another $1.3 billion to settle related claims. The first four banks operated what they described as “The Cartel” from as early as 2007, using online chatrooms and coded language to influence the twice-daily setting of benchmarks in an effort to increase their profits. The guilty banks “participated in a brazen display of collusion and foreign exchange rate market manipulation,” said U.S. Attorney General Loretta Lynch.
The complaint filed in the U.S. District Court for the Southern District of New York claims the banks conspired to manipulate the exchange rates in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1.
According to plaintiff Haverhill Retirement System, a Massachusetts pension fund, traders at the defendant banks corresponded with one another to set and manipulate WM/Reuters closing spot rates. WM/Reuters rates are the settlement rates of 158 currencies calculated and reported by a joint venture between WM Co., a subsidiary of State Street Corp., and Thomson Reuters. (Westlaw Journal is a Thomson Reuters business.) The defendant banks report the settlement price of their currency trades to the two companies, which in turn calculate the median bid, offer rates and then publish the result. The rates are the “industry-wide, global standard” for setting FX trades and derivatives tied to foreign exchange rates, the suit says. FX trading totals about $1.3 trillion per day, the plaintiff claims.