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Global regulators step up FX probe

Thursday, January 16, 2014 - 01:12

Jan 16 - Global regulators are stepping up their investigations into alleged manipulation of the $5 trillion a day foreign exchange market. US officials descended on Citigroup's London offices and Deutsche Bank has, according to sources speaking to Reuters, suspended several traders in New York. David Pollard reports.

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Citigroup's London office was visited by officials from the US Federal Reserve and regulators linked to the US Treasury, according to sources. While in New York, Deutsche Bank is believed to have suspended several traders. The inquiry centres on electronic chatrooms - where it's alleged traders colluded in order to manipulate global forex dealing. Citi and Deutsche are its two biggest players - accounting for nearly a third of the five-billion-dollar a day turnover in by far the world's largest - and unregulated - asset market. Citi has already fired its head of European spot forex trading - while Deutsche Bank is also under pressure from German regulators over separate inquiries into Libor fixing. Edward Hadas of Reuters Breakingviews. SOUNDBITE (English) EDWARD HADAS, ECONOMICS EDITOR, REUTERS BREAKINGVIEWS, SAYING: ''What we seem to have is continuing scandals and a big fight with the German regulator, BaFin. It's not too late for them to save their reputation but they're just not doing what they should be.'' A five-year investigation into the Libor scandal has already cost banks six billion dollars in settlements and resulted in suspects brought to court. British regulators are focusing on around 15 banks as part of their inquiry into the forex scandal. UBS and Barclays have confirmed they're cooperating with the inquiry. A number of others say they're reviewing their forex procedures.

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Global regulators step up FX probe

Thursday, January 16, 2014 - 01:12