UBS to pay US authorities $545m over forex-rigging scandals

 
Catherine Neilan
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Axel Weber: "The conduct of a small number of employees was unacceptable" (Source: Getty)
UBS is to pay $545m (£351.7m) to US authorities to settle a series of investigations into the bank's alleged rigging of the foreign exchange markets and Libor.
The Swiss bank confirmed the total, to be paid to the Department of Justice, the board of governors of the Federal Reserve and the Connecticut Department of Banking, this morning. As a result it has not been criminally charged for forex conduct.
The DoJ will also not file any charges concerning its investigations into the firm's V10 forex-related structured products, and its precious metals business.
UBS has received conditional immunity from prosecution for euro/dollar collusion from the DoJ's antitrust division.
“This immunity reflects UBS's role as the firm that first reported potential misconduct to the DoJ, and the full cooperation provided to the DOJ and other authorities throughout the world,” the bank said.
Consequently UBS has, however, agreed to plead guilty to one count of wire fraud for conduct in the Libor matter, which incurs a $203m fine and a three year term of probation.
On top of that, it will pay $342m to the Fed, over having engaged in “unsafe and unsound business practices relating to its FX business”.
UBS said it was “fully provisioned for these resolutions”.
“As a consequence, they will have no financial impact on second quarter 2015 results.”
UBS chairman Axel Weber and group chief executive Sergio Ermotti said in a joint statement:
The conduct of a small number of employees was unacceptable and we have taken appropriate disciplinary actions. We made significant investments to strengthen our control framework and compliance programs. We self-detected this matter and reported it to the US Department of Justice and other authorities. Our actions demonstrate our determination to pursue a policy of zero tolerance for misconduct and a desire to promote the right culture in our industry."
However the move will not draw a line under the scandal, which has rumbled on for years, and follows settlements last year with the UK's FCA and the Swiss Financial Market Supervisory Authority.
UBS said it continued to co-operate with ongoing investigations by other authorities in the matter, including the investigations of individuals.

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