Tags: Swiss Bank | UBS | Currency Trading | Settlement

Swiss Bank UBS Settles Currency-rigging Claims for $135 Million

Saturday, 14 Mar 2015 01:01 PM

Switzerland's largest bank, UBS, has agreed to pay $135 million to settle claims that it helped rig currency-exchange rates in a scheme involving some of the world's biggest banks.

The settlement announced Friday by the lead law firm in the case resolves a class-action lawsuit against UBS by pension funds and other investors that engaged in foreign currency transactions with the bank. The investors also sued 11 other major banks, accusing them of colluding together to fatten their profits by manipulating currency rates.

Authorities in the U.S., Great Britain and Switzerland have put banks' conduct in the multitrillion-dollar currency market under scrutiny. UBS, Citigroup, JPMorgan Chase, Bank of America and two other banks were recently fined a total $4.3 billion in civil settlements with regulators in those countries. The U.S. Justice Department is conducting its own criminal investigation of foreign-exchange rate setting.

The investors in the class action reached a settlement in January with one of the other banks, JPMorgan, for $99.5 million.

In the UBS and JPMorgan settlements, the banks also agreed to cooperate and provide information to the investors' attorneys as they pursue their cases against the other 10 banks.

Manipulation of the exchange rates can have a significant effect on the economy, regulators say, because a host of financial investments bought and sold by major investors like pension funds are based on benchmark rates for pairs of currencies that are fixed daily by the banks.

About $5 trillion changes hands every day on the global foreign-exchange market, with 40 percent of trades occurring in London. The market is loosely regulated and dominated by about a dozen elite banks.

With so much money flowing through the currency markets, a rigged procedure for fixing exchange rates can ripple through the financial system, regulators say. It also shakes people's confidence in the fairness and integrity of the system.

The alleged manipulation occurred around the market fixes, moments during the day when banks set benchmark prices for currency trades around the world.

The settlement is subject to approval by the federal court in the New York City borough of Manhattan.

The law firm that announced the settlement, Scott+Scott, said the investor group will obtain "unique and valuable cooperation from UBS, as it has" from JPMorgan, to build toward additional settlements.

In its annual report issued Friday, UBS, which is based in Zurich, Switzerland, noted its agreement to pay $135 million and to provide cooperation.

© Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

 
1Like our page
2Share
Companies
Switzerland's largest bank, UBS, has agreed to pay $135 million to settle claims that it helped rig currency-exchange rates in a scheme involving some of the world's biggest banks.The settlement announced Friday by the lead law firm in the case resolves a class-action...
Swiss Bank, UBS, Currency Trading, Settlement
403
2015-01-14
Saturday, 14 Mar 2015 01:01 PM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved