Published:  12:39 AM, 18 May 2019

Five banks fined €1bn for currency rigging

Five banks fined €1bn for currency rigging Four banks in the "Banana Split" cartel - Barclays, RBS, Citigroup and JP Morgan - were fined €811m. -BBC

Five banks have been fined €1.07bn (£935m) by the European Commission after traders clubbed together to rig the foreign exchange market.

Four banks in the "Banana Split" cartel - Barclays, RBS, Citigroup and JP Morgan - were fined €811m in all, reports BBC.Three banks in the "Essex Express" cartel - Barclays and RBS again, plus MUFG - were fined €258m. A sixth bank, UBS, was excused financial penalties for revealing the cartels' existence.

The European Commission said the market-rigging took place from 2007 to 2013.The Commission's investigation, which began in September 2013, revealed that some individual foreign exchange traders, using online chatrooms, exchanged trading plans and occasionally co-ordinated their trading strategies.

Competition Commissioner Margrethe Vestager said the banks' behaviour "undermined the integrity of the sector at the expense of the European economy and consumers".RBS said its €249m share of the fines was "fully covered by existing provisions". Barclays also said it had set aside money to cover the fine.

Similar fines for manipulating the currency markets were imposed in 2014 by UK, US and Swiss regulators. UBS, which escaped the latest fines, said: "This is a legacy matter where UBS was the first bank to disclose potential misconduct. We've made significant investments to further strengthen our control framework since then and are pleased this matter is resolved." But the matter may not end there.

Lambros Kilaniotis, a partner at City-based law firm RPC, said the Commission's announcement was "an open invitation for parties who may have been impacted by these cartels to sue these banks". "If they haven't already, any party involved in forex trading, such as institutional investors, pension funds and large corporates, should now be reviewing what losses they have incurred," he added.

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