4 banks pay nearly $1bn to settle forex rigging suit

GMT 02:22 2015 Thursday ,18 June

Arab Today, arab today 4 banks pay nearly $1bn to settle forex rigging suit

4 major banks have reached separate agreements
New York - AFP

Four major banks have reached separate agreements to settle a US civil lawsuit over alleged foreign-exchange rigging in deals totaling nearly $1 billion, sources close to the situation said Wednesday.

The agreements by Goldman Sachs, French bank BNP Paribas and British banks Barclays and HSBC are preliminary and could change, the sources said, confirming a report on the settlements in The Wall Street Journal that cited people familiar with the matter.

The four banks' pending agreements would settle the civil lawsuit filed by Scott & Scott and Hausfeld that alleges their traders manipulated the forex market to boost the banks' profits.

According to the sources, Barclays will pay $375 million, HSBC $285 million, BNP Paribas nearly $100 million and Goldman Sachs about $130 million. Combined, the settlements total about $890 million.

None of the banks has admitted to the alleged rigging of the $5.3 trillion currency market, the sources said.

The deal is subject to approval by US authorities, notably by US District Judge Lorna Schofield in New York, in whose court the lawsuit was filed. A hearing is scheduled on June 25 at 2000 GMT, according to court documents reviewed Wednesday by AFP.

The four banks' position in the case was weakened last month by nearly $6 billion in fines ordered by US and British regulators from six major banks -- Barclays, JPMorgan Chase, Citicorp, Royal Bank of Scotland, UBS and Bank of America -- for rigging foreign exchange market and Libor interest rates.

Barclays, JPMorgan Chase, Citicorp and the Royal Bank of Scotland all pleaded guilty to US Justice Department charges of conspiring to manipulate the massive currency market.

Switzerland's UBS meanwhile pleaded guilty to violating a prior settlement of charges for rigging the Libor interest rate. And Bank of America was included with the other five banks in fines levied by the US Federal Reserve in the forex rigging case.

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