DislikedNovember 12, 2014
CFTC Orders Five Banks to Pay over $1.4 Billion in Penalties for Attempted Manipulation of Foreign Exchange Benchmark Rates Citibank, HSBC, JPMorgan, RBS, and UBS Coordinated Trading with Other Banks in Private Chat Rooms in Their Attempts to Manipulate Washington, DC...Ignored
By Suzi Ring, Liam Vaughan and Jesse Hamilton Nov 12, 2014 4:17 PM GMT
Citigroup Inc. (C) and JPMorgan Chase & Co. (JPM) were the hardest hit in the first settlements since authorities began a global probe into the rigging of key foreign-exchange benchmarks last year.
Citigroup will pay $1.02 billion to three regulators in the U.S. and U.K., and JPMorgan $6 million less, according to statements from the firms today. They are among six firms that will pay $4.3 billion to four regulators ranging from the U.S. to Switzerland’s Financial Market Supervisory Authority.
Banks and individuals could face further penalties and litigation following the 13-month probe into allegations dealers at the biggest banks colluded with counterparts at other firms to rig benchmarks used by fund managers to determine what they pay for foreign currency. The Justice Department, which is working with the Federal Reserve, and Britain’s Serious Fraud Office are still leading criminal probes into the $5.3 trillion-a-day currency market.
“Many will see this as drawing a line under this sad episode,” said Tim Dawson, an analyst at Helvea SA in Geneva who covers financial firms. “We are less optimistic,” he said. The banks are “likely to face a heavy burden of potential litigation in coming years.”
Attendees pass an advertisement for UBS AG during a break in sessions at the Swiss... Read More
Citigroup said in a statement “several” additional regulatory and enforcement bodies are still conducting probes. JPMorgan said it continues to cooperate with the Justice Department.
UBS AG (UBSN) was fined about $800 million, Royal Bank of Scotland Group Plc $634 million and HSBC Holdings Plc (HSBA) $618 million by the U.S. Commodity Futures Trading Commission, Office of Comptroller of the Currency, Britain’s Financial Conduct Authority and Finma. Bank of America Corp. will have to pay $250 million to the OCC. London-based Barclays Plc (BARC), which had been in settlement talks, said it wasn’t ready for a deal.