Fresh forex manipulation class action lawsuit seeks up to $10 billion in damages

Research by Fideres has encompassed price action around the London fix in 6 major dollar crosses

The Financial Times reports that the first class action lawsuit against several banks for manipulating forex rates has been filed in the US. Amongst the banks mentioned in the suit are Barclays and UBS and the evidence supplied includes research on price action in major currency pairs including the Euro, the Pound Sterling and others. While the suit is not the first one, it certainly is standing out with a definite intention to prove allegations.

The analysis that is included in the evidence has been compiled by Fideres at the request of the City of Philadelphia Board of Pensions and Retirement. The report alleges that there were some abnormal price movements right up until the moment when rumors have surfaced about the 4pm fix investigation. According to analysts cited by the Financial Times article the plaintiffs are seeking damages of up to $10 billion.

The pairs that the massive research encompasses are all including the US dollar traded against its major counterparties – the Japanese yen, the Australian and New Zealand dollars, the Euro, Sterling and Swiss franc over a whopping period of five years. According to the court filing there are patterns of sudden surges followed by equally abrupt reversals which is a behavior that is normally observed when there is collusion.

Anyone who has been trading fx for the past 10 or so years is aware of these crazy moves happening in the European afternoon – conveniently they have always been covered by a set of rumors that leak on the newswires. Once the damage has been done, rumors tended to be dispelled and the market went on to reassess the sharp spikes up or down.

The lawsuit is filed in a Manhattan Federal Court and is the tenth similar action so far.

For the full article cited here visit the Financial Times’ website.

For more on the global Forex industry see the LeapRate-Dow Jones Forex Industry Report.

Read Also: