Global Banks to Pay $5.6 Billion in Penalties

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Five global banks will pay more than $5 billion in total penalties, and four of them (J.P. Morgan Chase & Co., Barclays PLC, Royal Bank of Scotland Group PLC, and Citigroup Inc.) will plead guilty to conspiring to manipulate U.S. and European currency prices.

According to the Wall Street Journal:

Authorities said euro dollar traders at the banks, who were self-described members of “The Cartel” communicated through coded language in an online chat room to coordinate attempts to move rates set at 1:15 and 4 p.m.

The traders would withhold bids or offers to avoid moving the rate in directions that would hurt open positions held by other members of the group, in violation of antitrust laws, prosecutors said.

No traders have yet been criminally charged over the conduct, butNew York’s financial regulator said it required Barclays to fire eight employees in connection with the resolution. Investigations into individuals are continuing, according to government officials.

Lawyers for the banks are expected to enter a series of pleas in federal court in Connecticut later on Wednesday.

Citigroup, which was accused of being involved in the misconduct from December 2007 through January 2013, is paying the largest criminal fine of $925 million. The other banks were accused of engaging in the conduct for various periods with that time frame.

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In addition to the WSJ coverage, the Justice Department has released a statement on the parent-level guilty please by the banks. According to

“The five parent-level guilty pleas that the department is announcing today communicate loud and clear that we will hold financial institutions accountable for criminal misconduct,” said Assistant Attorney General Caldwell. “And we will enforce the agreements that we enter into with corporations. If appropriate and proportional to the misconduct and the company’s track record, we will tear up an NPA or a DPA and prosecute the offending company.”

Read the entire press release here:

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