The Justice Department is investigating currency market manipulation by traders at big banks, The New York Times reported.

A group of traders, nicknamed "the cartel," allegedly sent each other instant messages in electronic chat rooms to collectively time their trading activity. They reportedly flooded the market with trades just before benchmark rates were set in order to manipulate rates to their advantage.

''The manipulation we've seen so far may just be the tip of the iceberg,'' U.S. Attorney General Eric Holder told The Times. ''We've recognized that this is potentially an extremely consequential investigation.''

Editor’s Note: New Video: Obama Plans to Redistribute Seniors’ Wealth

The Justice Department is ''taking a leading role'' in the ''truly global investigation," he added.

Regulators in the United Kingdom, the European Union, Switzerland and Hong Kong are also looking into currency trading manipulation.

The investigation involves nine of the world's largest banks in terms of currency trading, including Barclays, the Royal Bank of Scotland and Citigroup, according to The Times.

At least one trader is cooperating with the investigation, the newspaper reported.

The Times described the currency market as huge, opaque and vulnerable to manipulation. More than $5 trillion a day is traded on it, making it larger than any stock or bond market. And it's critical to the world economy, as portfolios are valued based on a currency market benchmark.

Yet currency trading is lightly regulated and lacks public exchange with transparent pricing. A handful of large banks dominating the market control the information.

''This is a very opaque market and it would be good to investigate and know it better,'' Dagfinn Rime, a senior researcher at Norway's central bank, told The Times.

Banks have created their own web-based portals that act like exchanges except trading details are hidden from the public.

''These portals are like 'dark pools,' and they represent a major profit center for banks like Deutsche, Citigroup and Barclays,'' Michael King, an expert on currency trading, told The Times. ''But there is little transparency and that should concern regulators.''

In response to the investigations, large banks are considering blocking employees from using electronic chat rooms, The Wall Street Journal reported.

Traders have relied on multi-dealer chat rooms to communicate with clients and each other and to trade a securities and commodities, according to The Journal, but the investigations are revealing they may have opened an avenue for collusion and that traders using the chat rooms shared information with competitors that seemed inappropriate and joked about being able to influence the market.

Editor’s Note: New Video: Obama Plans to Redistribute Seniors’ Wealth

Related Stories:

Currency Spikes in London Provide Rate-Rigging Clues

Traders Said to Manipulate Currency Rates to Profit From Clients, Bloomberg News Reports