Daily Management Review

The Five Largest Banks in the World Were Accused of Manipulating the Forex Market


The five largest banks in the world are expected to be found guilty of a criminal offense and sentenced to a cumulative fine of more than $ 5 billion for fraud in the foreign exchange markets, reports Reuters.

US banks JPMorgan and Citigroup and the British Barclays and Royal Bank of Scotland will probably be found guilty of criminal charges against US Department of Justice in connection with the manipulation of the exchange rate market, informed sources told to the agency. In this case, JPMorgan and Citigroup will be the first of the largest US banks found guilty of a criminal offense for decades.

Swiss UBS may avoid criminal prosecution, since received immunity for having informed the authorities about the potential problem. However, the bank, according to sources Reuters, accused of manipulating Libor rate, and it will have to pay $ 200 million.

It is expected that Barclays will reach agreements with the British and US regulators, what means that there can be a fine is much higher than the fines of other banks, exceeding $ 2 billion.

The US Federal Reserve also fined financial institutions to $ 1.6 billion. In addition, Barclays will pay an additional fine of $ 1.3 billion to financial services department in New York and the British Department for Control of the financial markets.

The total amount of payments is $ 5.6 billion.

In November 2014 the US government fined the Bank of America, Citigroup and JPMorgan nearly a billion dollars for "risky practices" when trading in the foreign exchange market. Also, then Citigroup, JPMorgan, UBS, RBS and HSBC (UK) paid to European regulators (Britain and Switzerland) $ 3.3 billion for the manipulation of exchange rates.

In 2012, HSBC, the defendant in the US in illegal financial transactions, has agreed to pay US authorities $ 1.9 billion after it became known that the Mexican drug traffickers’s money passed through bank.

In 2011, the US and the EU have begun investigation into the manipulation of interest rates LIBOR (at this rate banks lend loans to each other). The illegal actions of employees of banks allowed to receive additional profit. In the case of Deutsche Bank will pay 2.5 billion dollars in fines. HSBC, Royal Bank of Scotland and JPMorgan got under suspicion.