Regulators step up probes into currency fixing

Tim Wallace
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COMPETITION authorities in Switzerland yesterday took their probe into alleged foreign exchange market manipulation to the next level, opening investigations into eight banks.

The banks are spread across Switzerland, the UK and US, and the move represents the latest step by a range of global regulators to get to the bottom of claims of market abuse.

The Swiss regulator, WEKO, said it is investigating RBS, Barclays, Credit Suisse, UBS, Julius Baer, Zurich Cantonal Bank (ZKB), JP Morgan and Citi.

“Evidence exists that these banks colluded to manipulate exchange rates in foreign currency trades,” the regulator said.

Credit Suisse rejected the claims.

“Credit Suisse AG was astonished to note the allegations made by the Swiss Competition Commission,” the bank said in a statement.

“Credit Suisse AG was not the subject of the preliminary investigation carried out by the Competition Commission into various banks.”

The bank also said: “These allegations are both inappropriate and harmful to our reputation. Credit Suisse AG will cooperate fully with the authorities in this matter.”

RBS said it would co-operate with the probe. The other banks declined to comment.

Meanwhile Deutsche Bank put Kai Lew, a London-based director of institutional foreign exchange sales, on leave amid its own probe.

The bank declined to comment.

Bank of England governor Mark Carney yesterday said the Financial Stability Board expects to publish recommendations on structural reforms to the forex markets, aimed at stopping any manipulation, by the summer.