If you keep up with our blog here at Intrepid Executive Group, you may recall a story we covered a few months back involving a massive currency rigging scheme conducted by several of the world’s largest banks. The offending banks have already paid out more than $10 billion in fines, making this one of the biggest rigging schemes in history, but new details have surfaced suggesting that even more fines are to be expected.
The scheme was conducted by nearly a dozen banks, some of which included Bank of America, Citi, BNP Paribas, JPMorgan, Barclays, Goldman Sachs, HSBC, Royal Bank of Scotland, and UBS.� U.S., British and Swiss regulators� allege the banks in question had manipulated currency markets for profit, conspiring among themselves to raise or lower prices.� This led to more than 30 bank executives and employees being fires, as well as some of the largest fines in history being handed down. But the banks are out the woods just yet, as a new round of fines are underway.
According to a report published by the Financial Times, Barclays, Goldman Sachs, HSBC and Royal Bank of Scotland have agreed to pay $2 billion each in regards to the currency manipulation scheme. Executives from each of the aforementioned banks agreed to this deal last Friday in a New York court.
What’s even more interesting is that, according to some financial and legal experts, the $2 billion agreement could pave the way for even more lawsuits. Being that London is the world’s biggest foreign exchange market (FOREX), U.K. banks would most likely be next on the chopping block for lawsuits stemming from the currency manipulation scheme.
As noted by one lawyer working on the case, London is an “attractive” target for jurisdiction claims, simply because it accounts for 40% of all Forex trades. With such a significant number of investors there, many of whom are eager to recover their lost money, it’s safe to assume that new lawsuits will be filed in the upcoming months.
“London has been and will continue to be a very attractive jurisdiction for claims,” said Mr Edward Coulson of Hausfeld, a legal counsel working on the case. “The US settlement covers mainly US investors: (But) London is about 40 per cent of the forex market, so there are a lot of other investors.”
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