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Brazil Fines Two Banks Over FX Manipulation Brazil’s Tribunal of the Administrative Council for Economic Defense (CADE) has approved three Cease and Desist Agreements to settle a cartel probe in the foreign exchange market, involving the Brazilian real and offshore currencies. The agreements were signed between CADE and the Royal Bank of Canada and Morgan Stanley Bank, as well as Pablo Frisanco de Oliveira, a former Deutsche Bank trader in local markets. A total of BRL 42.9 million ($13 million) will be collected for the Fund for the Defense of Diffuse Rights, as a pecuniary contribution, CADE says.
Citi Pays $100 Million to Settle Libor Suit Citi has paid $100 million after reaching a settlement with 42 US states’ Attorneys General over allegations it manipulated the benchmark interest rate USD Libor. The Attorneys General alleged that Citi misrepresented the integrity of the Libor benchmark to state and local governmental, not-for-profit, private, and institutional trading counterparties by concealing, misrepresenting, and failing to disclose that it, at times, made USD Libor submissions to avoid negative publicity and protect the reputation of the bank. This is the third fine paid by a bank relating to this investigation.
Bitcoin Tumbles After South Korean Exchange Hack The value of bitcoin dropped from from $7,256 to a low of $6,651 on Sunday night, following the news that the South Korean cryptocurrency exchange, Coinrail, was hacked over the weekend. In a statement on its website on Monday, Coinrail confirmed that there was a “hacking attempt” on June 10. The statement continues: “At present, 70% of your Coinrail total coin/token reserves have been confirmed to be safely stored and moved to a cold wallet and are in storage. Two-thirds of the coins confirmed to have been leaked are covered by freezing/recalling through consultation with each coach and related exchanges. The remaining one-third of coins are being investigated with investigators, relevant exchanges and coin developers.” Coinrail says that the exact extent of the hacking is still be determined.
INTL FCStone Subsidiary Introduces Web-Based Platform for Instant FX Trading The Global Payments Division of INTL FCStone’s London based subsidiary, IFL, has introduced FXePrice, a proprietary Web-based platform allowing IFL local currency liquidity providers to streamline executable prices to 140 currencies and 175 countries, according to the firm. The company says it has released the platform to select members of its global network of more than 300 correspondent banks, to obtain feedback and incorporate recommendations. A full roll out to its entire network of counterparties is planned for later in 2018.
And Another Thing... I have been reading through the application for bail lodged by Mark Johnson’s lawyers following his conviction and sentence to two years’ jail and not only do I think it previews his full appeal, but while I understand the job of the counsel is to make the best case they can by stretching facts to the limit, my natural reaction has also been that something went badly wrong during the trial for the verdict to be delivered the way it was.
Global FXC Unveils Global Index of Public Registers The Global Foreign Exchange Committee has launched a Global Index of Public Registers to serve as a central reference point for demonstrated commitment to the FX Global Code. Following the initial publication of the Code in May 2017, Market Participants expressed interest in developing public registers as repositories of individual Statements of Commitment to the Code. The GFXC published recommended characteristics for public registers in July 2017, and several public registers have since been established. The Global Index will aggregate information from participating public registers and make it available in a single location.
NY Fed Signs Global Code Statement of Commitment The Federal Reserve Bank of New York has released its Statement of Commitment to the FX Global Code. Using the common language of these releases, the New York Fed says it has reviewed the content of the Code “and, in issuing this Statement of Commitment, has confirmed that it acts as a Market Participant as defined by the Code. The New York Fed is committed to conducting its foreign exchange market activities, when acting as a Market Participant, in a manner consistent with the principles of the Code.”
NEX Group Reports Profit Lift as CME Deal Looms NEX Group’s full year results for year ending March 31 indicate healthy growth at the firm as it continues to close in on a sale to CME Group which was last week approved by NEX shareholders. For the year ended 31 March 2018, the group reported revenue of £591 million, an increase of 9% on the prior year both on a reported and on a constant currency basis. On a constant currency basis, revenue from NEX Markets was up 6% and from NEX Optimisation up 7%.
Former JPM FX Trader Indicted in US The US Department of Justice has announced it has brought an inductment against former JP Morgan EM FX trader Akshay Aiyer for his role in alleged FX market manipulation. Aiyer is specifically charged with conspiring to fix prices and rig bids and offers in Central and Eastern European, Middle Eastern, and African (CEEMEA) currencies. According to the indictment, from at least as early as October 2010 through at least July 2013, Aiyer, along with other New York-based CEEMEA traders working for rival banks, participated in a conspiracy designed to suppress competition in order to increase each trader’s profits and decrease each trader’s losses.
FMSB Issues Suspicious Transaction Reporting Guide The FICC Markets Standards Board has publishes a transparency draft of a new Statement of Good Practice on Suspicious Transaction and Order Reporting. The Statement covers the identification of suspicious transactions and orders and their reporting to the relevant regulator. In the UK and other jurisdictions regulated market participants have an obligation report such transactions to their regulator – in the UK this is as a Suspicious Transaction and Order Report submitted to the FCA. A suspicious transaction or order is one where there is a reasonable suspicion that it could constitute insider dealing, market manipulation or attempted insider dealing or market manipulation.