Deutsche Bank to pay $190m to settle rigging allegations

NEW YORK: Deutsche Bank AG agreed to pay $190 million to settle US litigation accusing it of rigging prices in the roughly $5.1 trillion-a-day foreign exchange market.
The German lender is the 15th of 16 banks to settle the private investor litigation, for a total payout of $2.31 billion.
Only Credit Suisse Group AG has not settled.
Deutsche Bank’s preliminary settlement was detailed in filings on Friday with the US District Court in Manhattan, and requires a judge’s approval. The bank denied wrongdoing.
Troy Gravitt, a Deutsche Bank spokesman, declined to comment, as did Credit Suisse spokeswoman Nicole Sharp.
Investors accused banks of conspiring to manipulate key currency benchmark rates, including the WM/Reuters Closing Spot Rates, or the Fix, by sharing confidential orders and trade information to coordinate their strategies.
Manipulation was allegedly done through chat rooms with such names as “The Cartel” and “The Mafia,” and tactics known as “front running,” “banging the close” and “painting the screen.”
The litigation followed worldwide currency-rigging probes resulting in about $10 billion in fines for several large banks.
On Friday, the US Federal Reserve fined HSBC Holdings Plc $175 million for failing to properly monitor currency traders.
Deutsche Bank’s settlement is the 5th largest in the investor litigation, after settlements of $402 million with Citigroup, $384 million with Barclays, $285 million with HSBC, and $255 million with Royal Bank of Scotland.
The investors’ law firms, Scott & Scott and Hausfeld LLP, called the Deutsche Bank accord “more than reasonable” given that the bank had “fewer indicia of liability” than others.
Other banks that settled are Bank of America, Bank of Tokyo-Mitsubishi UFJ, BNP Paribas, Goldman Sachs, JPMorgan Chase, Morgan Stanley, Royal Bank of Canada, Societe Generale, Standard Chartered and UBS.
US prosecutors also brought criminal charges related to currency rigging against six traders.— Reuters