Wednesday 6 November 2019 4:10 pm

Law firm tries to muscle in on £1bn forex cartel claim

US claimant law firm Hausfeld is trying to muscle in on a £1bn group action against a raft of banks who were found to have rigged the foreign exchange markets.

The Competition Appeals Tribunal (CAT) heard today that Hausfeld is set to bring a claim by the end of November.

The CAT was sitting for the initial hearing of a separate group action brought against the Royal Bank of Scotland, UBS, Barclays, Citigroup and UBS.

The collective action is being led by the former head of the pensions regulator Michael O’Higgins, who is representing corporate entities affected by the rigging, which include pension funds and asset managers.

Read more: Barclays and RBS among banks hit by £1bn forex rigging lawsuit

It is being brought by US law firm Scott & Scott backed by litigation funder Therium Capital Management.

The claim follows a May ruling by the European Commission that Barclays, RBS, JP Morgan, Citibank and UBS had violated EU competition law by rigging the foreign exchange markets in two cartels dubbed “Essex Express” and “Three Way Banana Split”.

The five banks have been collectively fined more than $8.5bn (£6.9bn) by eleven global regulators.

The claim is being brought as a collective action on an opt out basis, so all members of the class will be automatically included.

Read more: Barclays and RBS fined in forex rigging scandal

Hausfeld’s threatened case would also be brought on an opt-out basis.

Hausfeld said: “Hausfeld confirms that it is considering filing an opt-out collective action relating to unlawful manipulation of the foreign exchange (FX) spot market between 2007 to 2013. We are unable to comment further at this stage.”

If it does bring an action it could lead to a so-called carriage dispute, with the groups competing to represent the class of affected entities.

O’Higgin said: “We are encouraged that the judge has set out a timetable to move things along so that affected entities, including pension funds, other asset managers and corporates, can finally seek the damages owed to them as a result of the cartel activity of these banks, which went on for several years and was discovered over 5 years ago.”