US: Citigroup Drawn into CFTC Probe

Citigroup Inc. disclosed a new government probe involving the industry’s trading and clearing of interest-rate swaps five months after paying $425 million to resolve claims that it attempted to rig derivatives markets.

The bank is cooperating with the US Commodity Futures Trading Commission, New York-based Citigroup said Monday in a regulatory filing. The case is related to a pension fund’s 2015 antitrust lawsuit alleging that 12 of the biggest swap dealers blocked fund managers from trading the instruments on exchanges to preserve their profits,according to a person with knowledge of the investigation who asked not to be identified because the information isn’t public.

The disclosure is the latest questioning the role of Wall Street’s biggest dealers in helping determine the prices for a range of financial instruments. Authorities around the world have been clamping down on the derivatives and currency markets since 2013 after allegations that bank traders rigged benchmarks. In the currency market, more than a half-dozen lenders have been fined a total of more than $10 billion and scores of traders have been dismissed. Other investigations into gold markets and currency options are also under way.

Full Content: Bloomberg

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