Day: 5 January 2017

Former MF Global CEO Handed $5m Fine

Former MF Global CEO, Jon Corzine, has been fined $5 million and banned from working as a Futures Commission Merchant (FCM).

The US Commodity Futures Trading Commission (CFTC) announced today that it has obtained a federal court consent order against Corzine requiring him to pay a $5 million civil monetary penalty for his role in MF Global’s unlawful use of customer funds totaling nearly $1 billion and for his failure to diligently supervise the handling of customer funds.

Under the terms of the order, Corzine cannot seek or accept, directly or indirectly, reimbursement or indemnification from any insurance policy with regard to the penalty amount.

Heads Will Roll: First Individual Pleads Guilty to FX Manipulation

Jason Katz, who formerly worked as an FX dealer at Standard Bank, Barclays, BNP Paribas and ANZ, has become the first individual to plead guilty to participating in a price-fixing conspiracy in the FX market, the US Department of Justice (DoJ) announced today.

According to the relevant court documents, Katz was a dealer of Central and Eastern European, Middle Eastern and African (CEEMEA) currencies on the New York FX desks of three successive financial institutions, and from approximately January 2007 until July 2013, he conspired with FX dealers at competing institutions to “suppress and eliminate competition” by fixing prices in CEEMEA currencies, in violation of US law, according to the DoJ.

CME to Launch FX Monthly Futures

CME Group will expand its suite of FX derivatives with the launch of six FX monthly futures next month, providing clients with access to the front months of the FX forward curve.

The new contracts are in addition to the existing quarterly futures and will cover EUR/GBP, as well as five major currency pairs against the US dollar: AUD; GBP; CAD; EUR and JPY.

Subject to regulatory approval, the new instruments will be available for trading on CME from 27 February.

The monthly contracts are launching on the pairs where CME is seeing the most activity and demand. Currently the group offers over 90 FX futures and more than 30 FX options.

And Another Thing…

Welcome to 2017 – I hope it is successful for all.
We enter the new year with another buzz phrase doing the rounds – so-called “fake news” – something that apparently allows Joe Public to make things up and get a reaction (always a lure to some in society) and for politicians to use as a feint to avoid answering difficult questions.
Putting aside the oxymoron that is “fake news” (clue: it’s not “news”, it’s fiction or blatant lies) the foreign exchange market has not escaped its clutches.

Mexican Peso Drops to New Low Against the US Dollar

The Mexican peso dropped to a new low against the US dollar on Wednesday, in anticipation of the policies likely to be pursued under a Trump administration in the US.

MXN fell more than 2% against the USD, hitting 21.619, breaking the previous record low of 21.3952 that was set three days after Trump’s election victory on November 8.

As part of Trump’s election campaign, he has called for an overhaul of the North American Free Trade Agreement (NAFTA) and subsequently USD/MXN was often watched as a proxy on the election result during the presidential campaign and could be seen to fluctuate around the highly publicised presidential debates.