Five banks including Barclays and Royal Bank of Scotland have been fined a total of more than €1bn (£875m) by the European Union for rigging the multi-trillion dollar foreign exchange market.
The European commission said the banks, which also include Citigroup, JP Morgan and MUFG (Mitsubishi UFJ Financial Group), formed two cartels to manipulate the spot foreign exchange market for 11 currencies, including the US dollar, the euro and the pound.
The financial industry has been hit with billions of euros in fines worldwide over the last decade for the rigging of benchmarks used in many day-to-day financial transactions.
“These cartel decisions send a clear message that the commission will not tolerate collusive behaviour in any sector of the financial markets,” the European competition commissioner, Margrethe Vestager, said in a statement.
Photograph: Philip Toscano/PA
Vestager said most of the traders knew each other on a personal basis and set up chatrooms with names such as “Essex Express ’n the Jimmy” because all of them except “James” lived in Essex and met on their train commute to London.
One cartel ran between December 2007 to January 2013, while the other operated from December 2009 to July 2012, it added.
Swiss bank UBS was not fined as it had alerted the two cartels to the European commission.
JP Morgan and RBS said they were pleased to have settled the cases and that they had made changes to their controls. JP Morgan said it related to the conduct of one former employee and RBS that it served as a reminder of how it had lost its way in the past.
MUFG said it had also taken measures to prevent a reoccurrence.
Barclays and Citigroup declined to comment.
A group dubbed the “Three-Way Banana Split”, made up of traders at UBS, Barclays, RBS, Citigroup and JP Morgan, was handed a fine totalling €811.2m, with Citigroup taking the biggest hit at €310.8m.
The Essex Express cartel, involving UBS, Barclays, RBS and MUFG, was handed a €257.7m fine, with the penalty against Barclays the largest for this cartel at €94.2m.