Banks brace for more foreign exchange rigging exposure as civil lawsuits emerge

From YAHOO! Finance –

“Class-action cases are expected to follow vast fines for manipulating currency benchmarks.

Banks are bracing for hundreds of millions of pounds in new claims for foreign exchange manipulation from class-action lawsuits triggered by last week’s vast market rigging fines .

Barclays, Royal Bank of Scotland and four other banks were ordered on Wednesday to pay $6bn (£3.84bn) by UK and US authorities.

The Barclays penalty represents the biggest bank fine in British history.

The regulators, detailing how traders gathered in chatrooms using monikers such as “The Cartel” and “Coiled cobra” to rig the $5.3 trillion-a-day currency market, also forced the banks to plead guilty to criminal charges.

Lawyers say that the fines, as well as an investigation from the European Commission, could be a springboard to damaging civil litigation in the UK and Europe.”

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FCA fine gives context for Natwest over-compliance

From FT Advisor Blog

“Earlier this year, we revealed that Royal Bank of Scotland lender Natwest was provoking adviser ire with new affordability tests that went well beyond the demands of the regulator under the Mortgage Market Review.

In particular, the bank was one of several cited for refusing a remortgage request for a couple who were downsizing their loan and thus reducing their borrowing, in the process disregarding the transitional rules the sector had fought for that were designed to prevent such perverse outcomes.”

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