Global Banks Admit Guilt in Forex Probe, Fined Nearly $6 Billion

Six major banks agreed to pay fines near $6 billion for the varying roles of their traders roles in alleged manipulation of foreign exchange rates. “In total, authorities in the United States and Europe have fined seven banks over $10 billion for failing to stop traders from trying to manipulate foreign exchange rates, which are used daily by millions of people from trillion-dollar investment houses to tourists buying foreign currencies on vacation,” notes a report from Reuters. Traders are said to have used chat rooms to coordinate trades. The news report suggests the US has long hesitated to prosecute large parent banks to avoid unsettling customers or disrupting the overall economy. Analysts anticipate the probe to expand with more convictions for institutions and individual traders. The article concludes, “The global investigation into manipulation of foreign exchange rates has put the largely unregulated forex market on a tighter leash and accelerated a push to automate trading.” – YaleGlobal