Barclays, Citi, Chase, MUFG and Royal Bank of Scotland have been fined a total of 1.07 billion euros ($1.2 billion) by EU antitrust regulators for rigging the spot foreign exchange market for 11 currencies. The currencies that were affected are the Euro, British Pound, Japanese Yen, Swiss Franc, US, Canadian, New Zealand and Australian Dollars, and Danish, Swedish and Norwegian crowns.
Swiss bank UBS escaped a fine of 285 million euros since it alerted authorities of the rigging.
The first decision (so-called “Forex – Three Way Banana Split” cartel) imposes a total fine of €811 197 000 on Barclays, The Royal Bank of Scotland (RBS), Citigroup and JPMorgan.
The second decision (so-called “Forex- Essex Express” cartel) imposes a total fine of €257 682 000 on Barclays, RBS and MUFG Bank (formerly Bank of Tokyo-Mitsubishi).
UBS is an addressee of both decisions, but was not fined as it revealed the existence of the cartels to the Commission.
The EU investigation that has been ongoing for the past six years revealed that some individual traders from various banks in charge of forex trading — a form of trading executed on an intra-day basis — exchanged sensitive information and trading plans through various online professional chat rooms.
“The information exchanges…..enabled them to make informed market decisions on whether to sell or buy the currencies they had in their portfolios and when,” the Commission said in its report.
It further stated that most of the traders knew each other on personal basis and logged into multilateral chatrooms on Bloomberg terminals for the whole day, engaging in extensive conversations about a variety of subject, including updates on their trading activities.
You can read the full press release here.