FX Cartel: EU Antitrust Agency Fines Four Banks $390 MillionDecember 2, 2021
The European Commission has slapped a total fine of €344 million (around $390 million) on four banks, including UBS, Barclays, NatWest (previously RBS), HSBC and Credit Suisse, for their involvement in a forex cartel, the EU antitrust regulator announced on Thursday.
The hefty penalty came as the banks agreed to settle the case. The banks discussed and shared sensitive information and trading plans on a chatroom named ‘Sterling Lads’ for spot trading with G-10 currencies.
HSBC faces the largest penalty at €174.3 million, while Barclays has to pay €54.3 million. NatWest, which rebranded from RBS last year, is facing €32.5 million in fines, whereas Credit Suisse should cough up €83 million.
UBS, however, avoided the penalty with ‘full immunity’ as it blew the whistle against the scandal.
Barclays, RBS and HSBC received a 10 percent discount on the original penalty amount as they admitted their involvement with the forex cartel, but Credit Suisse did not receive any reduction as it did not cooperate with the authorities in the investigation.
Cracking Down on Financial Cartels
“Our cartel decisions to fine UBS, Barclays, RBS, HSBC and Credit Suisse send a clear message that the Commission remains committed to ensure a sound and competitive financial sector that is essential for investment and growth,” said Margrethe Vestager, Europe’s competition chief.
“Foreign exchange spot trading activities are one of the largest financial markets in the world. The collusive behaviour of the five banks undermined the integrity of the financial sector at the expense of the European economy and consumers.”
She also highlighted that this was the sixth cartel investigation by the European regulators since 2013.
NatWest said in a statement: “We are pleased to have reached this settlement regarding serious misconduct that took place in a single chatroom, and that involved a former employee of the bank, around a decade ago.”
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