Biggest Banks Said to Overhaul FX Trading After Scandals
The world’s biggest banks are overhauling how they trade currencies to regain the trust of customers and preempt regulators’ efforts to force changes on an industry tarnished by allegations of manipulation.
Banks have capped what employees can charge for exchanging currencies, limited dealers’ access to information about customer orders, banned the use of online chat rooms and pushed trades onto electronic platforms, according to the people, who asked not to be identified because they weren’t authorized to discuss their firms’ practices.
Regulators are probing allegations that traders shared data about orders with people at other firms using instant-message groups with names such as “The Cartel” and “The Bandits’ Club,” and with clients in a bid to win business.
Britain’s Financial Conduct Authority this year ordered banks to review their rules about conflicts of interest in the foreign-exchange market, a person with knowledge of the talks said. The regulator also plans to evaluate the controls that firms have over traders around the time benchmarks are set, according to its business plan.
Source: bloomberg- FX Trading
