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Dublin: 13 °C Wednesday 26 June, 2019
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Five banks fined €2.5 BILLION over rigging foreign exchange rates

The fines were handed down by UK and US regulators.

Image: AP/Press Association Images

BRITAIN’S FINANCIAL CONDUCT Authority has imposed fines totalling £1.1 billion (€1.4 billion) on five banks to settle allegations of foreign exchange rigging.

On top of the UK’s findings, US regulators announced over $1.4 billion (€1.1 billion) in fines against the banks, meaning total fines amount to €2.5 billion.

The FCA regulator said in a statement it had fined British banks HSBC and Royal Bank of Scotland, US groups Citibank and JPMorgan Chase, and Swiss bank UBS, for “failing to control business practices in their foreign exchange trading operations”.

The banks were found to be attempting to manipulate the rates of currencies to benefit traders.

Each will pay in excess of £200 million, while Barclays was not included in the settlement but is still being investigated.

Citibank will pay £225 million, HSBC Bank will pay £216 million, JPMorgan Chase will pay £222 million, The Royal Bank of Scotland will pay £217 million and UBS will pay £233 million.

In the statement, the FCA said that the foreign exchange market is a “systematically important financial market”.

“At the heart of today’s action is our finding that the failings at these Banks undermine confidence in the UK financial system and put its integrity at risk.”

Today’s fines are the largest ever imposed by the FCA, or its predecessor the Financial Services Authority (FSA), and this is the first time the FCA has pursued a settlement with a group of banks in this way.

They found that “widespread poor practice in the spot FX market” caused the rigging.

In the US, the Commodity Futures Trading Commission (CFTC) joined their British counterparts in levying the fines.

The CFTC said the banks were being punished for “attempted manipulation of, and for aiding and abetting other banks’ attempts to manipulate, global foreign exchange (FX) benchmark rates to benefit the positions of certain traders.”

Read: Ulster Bank has been fined €3.5 million for its IT problems

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