Tag: Rigging

Rigging

The Prosecution That Never Was

In this Profit & Loss exclusive, Rohan Ramchandani, who was recently acquitted of FX market manipulation by a jury in New York, breaks his silence on the case and gives his perspective on why he believes the prosecution’s arguments were fundamentally flawed.Cast your mind back to 2008. Lehman Brothers collapsed, the financial crisis ensued, causing a global recession, which in turn led to unemployment climbing and house prices falling. People lost their homes. There was public outrage at what happened, aimed primarily at global “bankers” though few understood exactly what role individuals had played. Nonetheless, in the following months, one question in particular recurred in the press, namely “who is being held accountable?” This was to prove the start of a multi-year “anti-banker” campaign provoking regulators and prosecutors to go hunting for blood.

StanChart Fined $40m in FX Rigging Probe

The New York Department of Financial Services (DFS) has fined Standard Chartered Bank $40 million for attempting to rig transactions in FX markets between 2007 and 2013. An investigation by the DFS, as well as an internal review by the bank, found that bank traders used a range of illegal tactics to maximise profits or minimise losses at the expense of the bank’s customers or customers at other banks. Specifically, it was found that between 2007 and 2013, traders based in New York and elsewhere joined traders at other locations in a chat room called “Old Gits”. According to the DFS, the chat room was formed so that traders could coordinate trading, share confidential information and otherwise affect FX prices, with one trader apparently describing the chat room to a new member as “a den of thieves”.

Cartel Members Acquitted of FX Market Manipulation

Richard Usher, Rohan Ramchandani and Chris Ashton, the three members of the now notorious “Cartel” chat room, have been found not guilty of FX market manipulation by a jury in New York.

It was alleged that between 2007 and 2013 Usher, Ramchandani and Ashton worked in coordination to fix prices and rig EUR/USD markets, participating in telephone calls and electronic messages, including near-daily conversations in a private electronic chat room, in order to achieve this. The indictment against them was issued in January of this year.

If found guilty the three could have each faced a maximum penalty of 10 years in prison and a $1 million fine.

EC Levels FX Charges Against Credit Suisse

Credit Suisse has revealed in its Q2 financial report that the European Commission (EC) is alleging that the bank engaged in anti-competitive practices relating to its FX business.

“On July 26, 2018, Credit Suisse Group AG and certain affiliates received a Statement of Objections from the European Commission (Commission), alleging that Credit Suisse engaged in anti-competitive practices in connection with its foreign exchange trading business. The Statement of Objections sets out the Commission’s preliminary views and does not prejudge the final outcome of its investigation,” the report states.

A spokesperson for Credit Suisse declines to comment on the news.

US Court Sentences FX Trader to Two Years

Mark Johnson, the former head of global FX cash trading at HSBC in London, has been sentenced to two years in prison following his conviction for eight counts of wire fraud and one conspiracy charge by a US court in October last year. Johnson was also fined $300,000.

Profit & Loss has reported extensively on the case, and just pulling out a few of the headlines provides a fairly decent timeline for how the case has developed since Johnson was arrested in New York almost two years ago.

FX Trader Arrest: Do Not Pass Go, Do Not Collect $8m

Two UK-based FX traders have been charged with wire fraud by the US Department of Justice, one of which has been arrested in New York. Galen Stops reports on the case.

On July 19, Mark Johnson, the head of global FX cash trading at HSBC, was arrested at New York’s JFK airport in connection with an ongoing investigation by the US Department of Justice (DoJ) into currency rigging.

Two days later, the DoJ officially brought charges against Johnson and Stuart Scott, former head of FX cash trading for EMEA at HSBC, for wire fraud.

US Fed Bans Former FX Trader From Banking

The US Federal Reserve Board has banned former Barclays and UBS FX trader, Matthew Gardiner, from working in the banking industry for his manipulation of FX pricing benchmarks. The board says that from January 2008 until at least January 2013 that Gardiner “routinely engaged in unsafe and unsound conduct” that included disclosing confidential customer information […]

Banks Face More Legal Action – This Time Over Sibor

Three years after the Monetary Authority of Singapore (MAS) sanctioned 20 banks and 133 traders over breaches in good conduct regarding the local interest rate fixing (Sibor), two US investment funds filed a class action lawsuit in New York on Friday (July 1) alleging “a massive conspiracy” to rig interest rates. The two funds, FrontPoint […]