Five banks fined £2 billion after currency rigging investigation
12/11/2014
UK, US and Swiss authorities have fined five banks more than £2 billion after widespread manipulation by the banks traders in the foreign exchange markets.
The Financial Conduct Authority (FCA) , the US Commodities and Futures Trading Commission (CFTC) and Swiss regulator Finma have fined the Royal Bank of Scotland, HSBC, Citigroup, JPMorgan and USB for "ineffective controls at the banks" which allowed traders "to put their banks’ interests ahead of those of their clients".
The FCA believes that the banks failings have undermined the publics confidence in the financial system.
According to settlement notices released on Wednesday, bank employees formed groups in which information was shared about client activity in breach of market rules.
Martin Wheatley, chief executive of the FCA, said:
“The FCA does not tolerate conduct which imperils market integrity or the wider UK financial system.”
George Osborne, UK chancellor, said:
“Today we take tough action to clean up corruption by a few so that we have a financial system that works for everyone. It’s part of a long term plan that is fixing what went wrong in Britain’s banks and our economy.”
All of the FCA fines were above £216m, which make them the highest FCA penalties ever imposed, breaking the record previously held by UBS, which paid £160m to the FCA in 2012 over libor rigging.
All five banks have said that they are troubled by the misconduct and are making improvements to the systems and controls to better handle against improper trading behaviour.
The FCA probe has brought to light rigging from banks all over the world, and 15 banks are now being probed by 20 regulators worldwide. Experts believe this is just the beginning of what is expected to be a long running scandal that will continue to unnerve the worlds leading traders for months to come.
Need financial advice?
If you have any personal finance questions related to this news article, then please contact our financial advisers. You can get in touch by asking a question online, calling us on 0800 092 1245, or by arranging a visit.
Share this..
Related stories
Austerity fears hit the UK manufacturing sector
The UK manufacturing sector has seen growth fall to a nine-month low in August with major concerns about the government's austerity measures coming to the fore. The UK government is literally cutting the public sector budget by billions upon billions of pounds and at the same time increasing taxes across the board. As a consequence, manufacturing in the UK is almost certain to slow down in the sho...
Read MoreHow long before the UK economy is back on its feet?
While the worldwide economy seems very much to be on the road to recovery, there are still many concerns regarding the UK economy which appears to be very sluggish compared to other European and worldwide economies. So how long before the UK economy will actually be back on its feet?
Even though every government around the world has had significant problems with regards to governmen...
Treasury Select Committee warns city to hire more women
The influential Treasury Select Committee has this weekend issued a report warning the UK financial sector of a need to increase the number of women appointed to influential positions in the industry. This is an age-old debate which has been going on for many years and it is well established that there is a lack of business women in the financial sector and especially towards the upper tiers of th...
Read MorePay deals steady
The number of pay deals above four per cent is increasing as inflation in Britain rises, a report by Income Data Services (IDS) shows.In the three months up to April, the average pay deal held steady at 3.5 per cent, the IDS survey found, yet the number of pay deals above four per cent continued to rise.Early 2007 saw the number rise from a quarter of all deals to more than a third in the previous...
Read MoreRetails Sales Growth In The UK Has Stalled
News that like for like retail sales growth in July fell by 0.9% was something which was not totally unexpected by the market. This latest fall is the fourth in the last five months and is a trend which is set to continue for the foreseeable future.
It is not just the affect of falling sales which is hitting the high street but also the increase in underlying costs. This double...