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UPDATE 1-UK watchdog sees rising requests for help on currency probe
July 10, 2014 / 11:47 AM / 3 years ago

UPDATE 1-UK watchdog sees rising requests for help on currency probe

(Recasts with foreign exchange requests)

LONDON, July 10 (Reuters) - Britain’s financial regulator said on Thursday it expected to receive a rising tide of requests for help from its overseas peers as part of “unprecedented” global cooperation in an investigation into the vast foreign exchange market.

The Financial Conduct Authority (FCA), which publicly announced an investigation into allegations of misconduct in the $5.3 trillion-a-day currency markets last October, said it had received 52 requests for assistance on forex inquiries this financial year.

“We anticipate that trend increasing this year as our investigation progresses,” it stated in its Enforcement Annual Performance Account, designed to examine how fair and effective the regulator is, published alongside its annual report.

“The lessons learned, and relationships built, during the Libor investigations have helped to ensure the process is as efficient and effective as possible.”

A global investigation into allegations that traders rigged benchmark interest rates such as Libor (London interbank offered rate) has prompted regulators to fine 10 banks and brokerages around $6.0 billion and prosecutors to charge 17 men.

As market misconduct increasingly crosses borders, the FCA said the total number of assistance requests received this year - which can include interview requests as well as more routine information gathering - totalled 1,022.

The FCA also said the amount of suspicious share trading activity that takes place in the run-up to mergers and acquisition announcements in Britain rose slightly over the year, ending three years of falling figures.

Abnormal pre-announcement price movements were recorded before 15.1 percent of such announcements in the last financial year, up from 14.9 percent in the prior period.

However, the FCA, which has been keen prove its mettle in cracking down on market abuse since its launch in 2013, stressed in its annual report that this was still well down on the nearly 30 percent level seen back in 2010.

Unexplained share price moves can be a possible sign of insider trading or other forms of market abuse. (Reporting by Kirstin Ridley and Huw Jones; Editing by David Holmes and Mark Potter)

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