Swiss banking giant UBS is expected to announce a settlement with financial regulators over allegations of misconduct at their precious metals and foreign exchange desk.
According to the Financial Times, UBS is one of six banks ready to announce they are to pay a total of $2.37 billion in fines to settle accusations of precious metals and foreign exchange manipulation. The six banks named in the report are Barclays Bank, The Royal Bank of Scotland, HSBC, Citigroup and JPMorgan.
Unlike the other banks UBS’s precious metals desk is incorporated into its foreign exchange department. The two departments shared the same management team and sat on the same trading floor. UBS has launched an internal investigation into the allegations but declined to comment on the proposed settlement.
According to the FT’s report, a source close to the matter confirmed a number of problems and incidents had been uncovered. Interestingly Mr Flotron, the boss of the banks gold trading desk in Switzerland has been on leave since January.
Regulators have now turned their attention to potential manipulation of precious metals markets. In May the Financial Conduct Authority fined Barclays Bank £26 million after trader Daniel Plunkett was found guilty of manipulating the London gold fix. German regulator Bafin has also launched an investigation into possible precious metals manipulation at Deutsche Bank.