The European Union said on Thursday it has fined four major banks a combined €344 million ($390 million) for colluding in a foreign exchange spot trading cartel via a chatroom named “Sterling Lads.”
The UK-based banks agreed to settle the case, with HSBC receiving the biggest fine of almost $200 million. Barclays, NatWest (former RBS Group), and Credit Suisse got smaller penalties, while UBS escaped a fine because it had revealed the cartel.
According to the European Commission (the EU’s executive arm), the cartel had focused on forex spot trading of G10 currencies, which include the US dollar, euro, and UK pound.
It accused traders of exchanging sensitive information and trading plans and occasionally coordinating their trading strategies via the chatroom.
“Foreign exchange spot trading activities are one of the largest financial markets in the world. The collusive behavior of the five banks undermined the integrity of the financial sector at the expense of the European economy and consumers,” said the Commission’s competition chief, Margrethe Vestager.
Since the financial crisis of 2008, regulators worldwide have been hitting banks with hefty fines for the rigging of benchmarks used in many day-to-day financial transactions.
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