US Court Approves FX-Rigging Lawsuit Against 15 Big Banks

The banks allegedly manipulated forex rates between 2003 and 2013.

A United States court has agreed on permitting institutional investors to pursue a class-action lawsuit against 15 major banks for rigging forex rates, Reuters reported on Friday.

Per the lawsuit, the accused banks were involved in manipulating the prices of $6.6 trillion-a-day in the forex currency benchmark rates between 2003 and 2013.

The defendants include banks like Bank of America, Barclays, BNP Paribas, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, JPMorgan Chase, Morgan Stanley, Royal Bank of Canada, Royal Bank of Scotland, Societe Generale, Standard Chartered, and UBS, all of which sometimes controlled 90 percent of the forex market.

The permission to continue the lawsuit was granted by the US District Judge Lorna Schofield in Manhattan.

“This is an injury of the type the antitrust laws were intended to prevent,” the judge wrote in the 40-page decision.

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Nearly 1,300 plaintiffs, including many mutual funds and exchange-traded funds and investors like BlackRock and Allianz SE’s Pacific Investment Management, moved to court against the big banks.

The lawsuit accused that the banks conspired to share confidential orders and trading positions of forex with each other using chatrooms names “The Cartel,” “The Mafia,” and “The Bandits’ Club.”

The banks, however, pointed out that the plaintiffs could not point out any specific transactions for showcasing the manipulations.

A massive scandal went on for years

The litigation was filed in November 2018, and several plaintiffs also opted out from similar lawsuits after receiving $2.31 billion in settlement deal from banks. The settlement, however, sparked global regulatory probes and resulted in fines of over $10 billion to several banks.

In the recent case, the court, however, dismissed some part of the case along with some plaintiffs as well.

Last November, a London court heard a similar class-action lawsuit against five global banks involving around $1.3 billion.