Brazil probes US Citigroup, 14 more banks for forex fixing

Brazil’s antitrust body announced an unprecedented probe for the country into alleged foreign exchange market rigging by 15 banks including Citigroup and HSBC, which are accused of colluding to form a secret cartel. “There are strong indications of anticompetitive <g data-gr-id="22">practises</g> of price fixing” and other manipulations between the banks, the watchdog known as Cade <g data-gr-id="23">said .</g> 

The alleged cheating lasted from 2007 until at least 2013, authorities said. “The evidence shows that (the banks) formed a cartel” fixing prices, coordinating <g data-gr-id="25">trades,</g> and impeding other operators involved in the Brazilian market,” the watchdog said. There is also evidence that the banks shared sensitive information on contracts, futures prices, clients, negotiating strategies and other confidential material, Cade said.

Brazilian investigators say the banks under scrutiny communicated online via the Bloomberg chat platform to organise what they themselves referred to as “The cartel” and “The mafia.”  The other 13 banks named are: Banco Standard de Investimentos, Tokyo-Mitsubishi UFJ, Barclays, Credit Suisse, Deutsche Bank, JPMorgan Chase, Merrill Lynch, Morgan Stanley, Nomura, Royal Bank of Canada, Royal Bank of Scotland, Standard Chartered and UBS. In addition to the institutions, the probe is targeting 30 individuals who were not identified.

Similar probes around the world, including in South Africa, South Korea, Europe and the United States have targeted much of the same group of banks. In May, US and British regulators fined Barclays, JPMorgan Chase and several others a total of nearly $6 billion between them for rigging foreign exchange market and Libor interest rates. No Brazilian banks were named in the investigation, which was the first of its kind by Brazil, a developing Latin American  economic powerhouse..