One of the world’s biggest cartels has been busted with five of the world’s largest banks fined $5.7 billion for charges including manipulating the global foreign exchange market.
Four of the banks – JPMorgan, Barclays, Citigroup and RBS – have pleaded guilty to US criminal charges and the fifth, UBS, pleaded guilty to rigging benchmark interest rates. The banks were fined by both the US Federal Reserve and the US Department of Justice.
The banks allegedly used a chat room, known as The Cartel, to manipulate prices to make money. The invitation-only group, made up of banks that were supposed to be competing with each other, colluded to cheat clients and manipulate currency rates and the London interbank offered rate, known as Libor.
This was the largest and least regulated market in the financial world, where some $5 trillion changes hands every day.
No individual bank employees has been hit with criminal charges.