LONDON – Switzerland’s attorney general has opened a criminal investigation of several individuals in relation to potential manipulation of the foreign currency markets, a spokeswoman confirmed on Thursday.
The inquiry by Attorney General Michael Lauber’s office is the latest criminal investigation to emerge as prosecutors and regulators examine whether traders at some of the world’s largest banks colluded to influence currency benchmark rates.
The United States Justice Department and the Serious Fraud Office of Britain are both conducting criminal inquiries, and the Justice Department is expected to have meetings with several banks in the coming weeks.
On Wednesday, regulators in Britain, the United States and Switzerland fined a group of the world’s largest banks a combined $4.25 billion to settle civil inquiries accusing them of conspiring to manipulate the currency markets.
The Foreign Currency Fix
Regulators say that a group of London traders, known as the “cartel” and the “mafia,” illegally dipped into the $5.3-trillion-a-day currency trade.
By Channon Hodge, Aaron Byrd and David Gillen on Publish Date March 11, 2014. Photo by Aaron Byrd/The New York Times.The banks that settled with the Financial Conduct Authority of Britain and the Commodity Futures Trading Commission are UBS of Switzerland, HSBC and the Royal Bank of Scotland of Britain, and JPMorgan Chase and Citigroup. Separately on Wednesday, the Office of the Comptroller of the Currency also settled with Bank of America, JPMorgan and Citigroup.
On Thursday, Jeannette Balmer, a spokeswoman for Mr. Lauber, said his office was investigating several individuals in relation to foreign currency trading. She declined to say how many individuals or where they were employed.
The attorney general’s office is not investigating any banks involved, she said.
Mr. Lauber is examining potential breach of trust and potential violations of professional secrecy rules.
As part of the investigation, the attorney general’s office has exchanged information with the Swiss Financial Market Supervisory Authority and Switzerland’s Competition Commission.
On Wednesday, the supervisory authority announced that it had fined UBS 134 million Swiss francs, or about $138 million, after it found that UBS employees in Zurich had attempted to manipulate foreign exchange benchmarks over an extended period of time. It also said it had begun enforcement proceedings against 11 current and former UBS employees.
The Swiss regulator said it had investigated three other Swiss banks regarding potential misconduct in foreign exchange trading and that any shortcomings it identified would be remedied by corrective supervisory measures, rather than fines.
Big Banks Are Fined $4.25 Billion in Inquiry Into Currency-Rigging
The fines come as regulators are increasingly targeting a business culture in the financial industry that they say encourages improper conduct by its employees.