HSBC, Barclays and Natwest of banks fined £293m for Forex scandal
HSBC, Barclays and Natwest among banks fined £293m for ‘Sterling Lads’ forex scandal
HSBC, Barclays and Natwest are among the lenders who have been fined a total of £293 million for their involvement in the ‘Sterling Lads’ foreign exchange scandal.
The banks, along with Credit Suisse and UBS, were part of a “cartel” that colluded to fix the prices of various foreign currencies, the European Commission found.
Traders at the banks exchanged information in a chat room called Sterling Lads, which allowed them to decide when to buy or sell the currency they held.
HSBC, Barclays and Natwest were part of a ‘cartel’ that colluded to fix the prices of several foreign currencies, European Commission found
This meant that they could influence the price for their own profits, rather than letting independent players in the market dictate the price.
HSBC was awarded the highest fine of £148 million after a 15 per cent cut for its assistance in the investigation.
Barclays’ fine was £46m after it was cut by a third, and Natwest’s was £28m after a 50 percent cut.
Credit Suisse received no discounts for its cooperation and the fine totaled £71 million. UBS was released for blowing the whistle on the cartel.
Margrethe Vestager, head of competition at the European Commission: ‘The covert behavior of the five banks undermined the integrity of the financial sector at the expense of the European economy and consumers.’
Businesses generally use currency traders when they need to exchange large amounts of different currencies.
Natwest said his role in the scandal involved an “ex-employee” about a decade ago.
A spokesperson added: “Our culture and controls have fundamentally changed over the past 10 years and this kind of behavior has no place in the bank we are today.”
Barclays and HSBC declined to comment last night.