Forex Manipulation Lawsuits
- by Ayden
Recent class action lawsuits have been filed against large banks for currency rate manipulation. These lawsuits allege that large banks conspired to manipulate WM/Reuters Closing Spot Rates. UBS and six other large banks have collectively paid regulators $4.3 billion in settlements in the past year. A UBS settlement was mentioned in the company’s 2014 annual report, in which it reported a decrease in 4Q profits.
Forex traders misused confidential information to make secret profits
There has been a significant amount of controversy over whether or not Forex traders misused confidential information to make secret, illegal profits. Some have claimed that these traders hacked into other investors’ accounts and used their information to make huge profits, but the truth is far more complicated. The TIRN scandal revealed how TIRN operators misappropriated US$15 million from investors. Since then, Giambrone & Partners has been advising investors from around the world to recover their funds.
While insider trading has been illegal in the United Kingdom since 1980, proving responsibility for improper trading is extremely difficult. In many cases, the traders hide behind nominees or offshore companies that cannot be easily traced. Despite the difficulties in prosecuting insiders, the Securities and Exchange Commission prosecutes over 50 cases annually, although many are settled administratively. In some instances, the SEC may refer cases to the U.S. Attorney’s Office for further investigation. Insider trading can be a significant problem for both investors and regulators.
JP Morgan settles class action
The Court has preliminarily approved two Settlement Classes: those who held eligible ADRs directly or through a nominee, and those who hold ADRs through a nominee but are not listed in JPM’s transfer agent records. The settlement will provide relief to eligible Class Members. Traders should read the website carefully and determine if the settlement will provide any benefits to them. The class action was filed by traders alleging that the defendants violated the federal securities laws.
The settlement consists of three payments: for those who were directly affected by the manipulation, $20 for each $100,000 in investment, and for those who were affected indirectly by the same scheme. For those who were not directly affected by the price manipulation, they will each receive $50 plus $1 for every $10,000 over $1 million. The plaintiffs were represented by Koskie Minsky LLP, Sotos LLP, and Siskinds LLP.
Citigroup and Barclays close to settling
US Attorney General Eric Holder on Monday announced that several investment banks have settled forex manipulation lawsuits. Citigroup, JP Morgan, RBS, and UBS are accused of rigging the global foreign exchange market. The claim against these banks is valued at more than $1.24 billion, according to the US Department of Justice. Barclays and UBS declined to comment on the matter. The US Department of Financial Services, however, is involved in the proceedings.
The two law firms represented by the plaintiffs are Scott&Scott and Hausfeld. The firms represent hedge funds, state pension funds, the city of Philadelphia, and an Oklahoma firefighter’s pension. They are in the process of working with investors to maximize claim recovery. Among the remaining defendants are Credit Suisse, Deutsche Bank, Royal Bank, and Morgan Stanley. This could lead to a settlement for all investors in the case.
UBS settles class action
After being sued in a US-style class action case, three major international banks – UBS, BNP-Paribas, and Bank of America – have settled a lawsuit involving alleged foreign-exchange rate manipulation. The Swiss bank also pledged to provide information to other banks in the same way it did to settle its case. As many as 40 other banks were implicated in the alleged scheme to manipulate currency exchange rates.
The settlement reportedly includes about $1 billion worth of allegedly unsuitable trading of the Swiss bank’s forex products. The lawsuit was filed in New York and echoes other high-profile U.S. class actions that have swept the financial world. In its settlement, UBS has agreed to cease violating its rules and pay disgorgement funds to impacted investors. In addition to the disgorgement funds, UBS agreed to pay an $8 million civil monetary penalty. Although the Swiss bank has declined to comment, it did mention the possibility of a class action in its quarterly report.
UBS agrees to a $135 million settlement
Switzerland’s largest bank, UBS, has agreed to settle civil litigation in the U.S. involving alleged currency market manipulation. The Swiss bank has agreed to pay $135 million to resolve the case. The plaintiffs in the lawsuit were various pension funds and other investors. The settlement will help the investor group pursue further claims against other banks involved in the conspiracy. The agreement is subject to approval by the federal court in Manhattan.
The settlement follows the January 2013 resolution in which JPMorgan Chase & Co agreed to pay $99.5 million to resolve the antitrust suit. Last month, Credit Suisse said it would set aside more money to settle the US probe and to pay disgorgement to V10 investors. The Swiss bank will also pay a civil monetary penalty of $8 million. The settlement agreement also states that UBS will spend some of the funds on litigation.
WM/Reuters rates are widely used as pricing benchmarks
The World Markets/Reuters rates are widely used as pricing benchmarks in the currency market. These rates are derived from the median rate of currency transactions within a 60-second window. They are widely used as pricing benchmarks for derivatives and are also commonly referred to as “spot” rates for currency transactions. The WM/Reuters rates are also used by the major equity and bond index compilers. Some banks guarantee their clients’ prices using these rates.
The WM/Reuters rates are a common target of Forex manipulation lawsuits. The Reuters rates are widely used by traders to calculate the value of a currency pair. The FCA investigated banks and traders within a group to see if they had shared confidential customer order information and altered their trading positions to suit their collective interests. The traders allegedly colluded to push the rate up or down during the 60-second window. The result was a lower return for class members than they should have received.
Recent class action lawsuits have been filed against large banks for currency rate manipulation. These lawsuits allege that large banks conspired to manipulate WM/Reuters Closing Spot Rates. UBS and six other large banks have collectively paid regulators $4.3 billion in settlements in the past year. A UBS settlement was mentioned in the company’s 2014 annual…
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