Six of the world’s largest banks have been fined a combined £3.7 billion for manipulation of the currency and foreign exchange markets. Royal Bank of Scotland, UBS, Citigroup, Barclays and Bank of American were fined by U.S and UK regulators on Wednesday following an ongoing investigation. Despite the record fine shares in all the banks rose following the announcement.
The traders used internet chat rooms to organize their manipulation and called themselves the “cartel” and the “three musketeers.” One Barclays trader was caught saying “if you aint cheating, you ain’t trying.” Despite systematic manipulation costing corporations and individuals an estimated $200 bn no bank employee has been sentenced for their crimes. What is particularly outrageous is the names of the traders involved will not be made public.
In the last few year’s banks on both sides of the Atlantic have been caught manipulating the Libor Benchmark, electricity markets, gold price, and helping Mexican drug cartels launder money.
Ultimately, it will be the banks customers and investors who will pick up the bill.