Barclays, Citigroup, JP Morgan, MUFG, and Royal Bank of Scotland were fined a combined €1.07 billion (US$1.2 billion) by the European Union on Thursday, May 16, for rigging the multi-trillion dollar foreign exchange market, reported Reuters.
Banks have been hit with billions of dollars in penalties worldwide over the last decade for the rigging of benchmarks used in many day-to-day financial transactions, further damaging the industry’s fragile reputation after the financial crisis.
The European Commission stated that individual traders at the banks involved formed two cartels to manipulate the spot foreign exchange market for 11 currencies, including the dollar, the euro, and the pound.
“These cartel decisions send a clear message that the Commission will not tolerate collusive behavior in any sector of the financial markets,” European Competition Commissioner Margrethe Vestager said in a statement.
Citigroup was hit with the highest fine of €311 million, while Swiss bank UBS was not fined as it had alerted the two cartels to the European Commission.
The EU competition enforcer said most of the traders knew each other on a personal basis and set up chatrooms such as “Essex Express ‘n the Jimmy”, which was given this name because all of them except “James” lived in Essex, to the east of London, and met on their train commute to the British capital.
The five-year investigation found nine traders spread across the banks exchanged sensitive information and trading plans in the chatrooms and occasionally co-ordinated trading strategies.
“The traders, who were direct competitors, typically logged in to multilateral chatrooms … and had extensive conversations about a variety of subjects, including recurring updates on their trading activities,” the Commission said in a statement.
Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.
Featured News
Google and South Carolina Clash Over State Records Demand
May 8, 2024 by
CPI
Telefonica Germany Teams Up with Amazon Web Services to Migrate 5G Customers
May 8, 2024 by
CPI
Federal Judge Grants $7.4 Million Settlement in Pork Price-Fixing Case
May 8, 2024 by
CPI
Wilson Sonsini Bolsters Antitrust and Competition Practice with Key Partner Returns
May 8, 2024 by
CPI
EU to Scrutinize Telecom Italia’s Network Sale to KKR
May 8, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Economics of Criminal Antitrust
Apr 19, 2024 by
CPI
Navigating Economic Expert Work in Criminal Antitrust Litigation
Apr 19, 2024 by
CPI
The Increased Importance of Economics in Cartel Cases
Apr 19, 2024 by
CPI
A Law and Economics Analysis of the Antitrust Treatment of Physician Collective Price Agreements
Apr 19, 2024 by
CPI
Information Exchange In Criminal Antitrust Cases: How Economic Testimony Can Tip The Scales
Apr 19, 2024 by
CPI