Five Banks Accused of a £1 Billion Forex Rigging Scheme

Free $100 Forex No-Deposit Bonus

Citigroup, Barclays, Royal Bank of Scotland, UBS, and JPMorgan have all been accused of rigging the foreign exchange market. The court case will be heard on Wednesday at London’s tribunal.

Facing the Expensive Music

The five banking giants are facing a class-action lawsuit that has them potentially dolling out more than £1 billion in fines. This is to facilitate compensation of asset managers, pension funds, corporations, and hedge funds that lost potential money due to the banks participating in a so-called market manipulation scheme. This scheme claimed to have happened between the years 2007 and 2013. An important note is the number of fines may shift depending on the number of trades that were done in London specifically and how it affected the GBP trades.

The UK lawsuit claims that the banking firms being accused have worked in tandem with each other in order to manipulate prices for offers, spreads, and bids for currency spot trades. The charges for illegal activities will be conducted first before they enact their fines. The fines have the possibility of being up to a tenth of their global turnover.

Keeping Banks In Check

Scott + Scott is serving as representatives for the investors during the lawsuit. The lawsuit itself was filed during the Competition Appeal Tribunal that happened in the month of June. The firm opened a dedicated European office in order to lead the UK team, its US arm doing something similar previously and managed to generate $2.3 billion in settlements. Many banks have faced an incredible amount of fines in response to allowing traders to band together and rig FX markets for personal gain.

The style of lawsuits happening in the UK is mirroring the US’s style of class actions. It’s a popular litigation method because various groups can band together into one collective entity in order to sue one party. British courts have been allowed to hear the collective style of legal actions for almost four years now, starting in 2015

EU On The Backfoot

The EU’s investigations have lagged behind for the most part. However, the UK, Swiss, and US regulators have practically jumped on the banks for their misconduct and set up a $10 billion fine to penalize the global banks. The EU’s most recent steps come almost two years after it was forced to fine banks over Libor and Euribor rate collusions.

While the events of now may be terrible, it’s an essential reminder of why we need watchdog firms to keep a close eye on massive firms like banks. In the end, these firms are just businesses that are looking to earn money. The difference is that these companies also know that they’re the biggest fish in the pond and convince themselves that they can do whatever they please, should they choose to. Regulators ensure that it never happens, at least for long. Large businesses like banks are like children pushing the boundaries of what’s allowed for them to do. It’s essential to make sure they know what lines not to cross and to make them pay if they did.

Copyright © 2020. All Rights Reserved. FXDailyReport.Com
Risk Warning: Trading CFDs is a high risk activity and you may lose more than your initial deposit. You should never invest money that you cannot afford to lose. will not accept any liability for loss or damage as a result of reliance on the information contained within this website including data, quotes, charts and buy/sell signals. Please be fully informed regarding the risks and costs associated with trading the financial markets.