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Banks Fined $4 Billion|for Forex Manipulations

(CN) - American and European regulators Wednesday fined major banks a total of $4.25 billion for conspiring to manipulate foreign currency markets.

More than $5 trillion is traded in foreign exchanges markets every day, at rates that constantly change, usually by small increments.

The U.S. Commodity Futures Trading Commission said it filed settled complaints fining Citibank, HSBC Bank, JPMorgan Chase Bank, The Royal Bank of Scotland and UBS a total of $1.4 billion.

Citibank and JPMorgan each was fined $310 million; RBS and UBS $290 million each; and HSBC $275 million, the CFTC said in a statement.

Britain's Financial Conduct Authority announced today it had settled with five banks for 1.1 billion pounds, or $1.7 billion. Those banks are UBS, of Switzerland; HSBC and the Royal Bank of Scotland, of Great Britain; and JPMorgan Chase and Citigroup, of the United States.

The Financial Conduct Authority said it is still investigating Barclay's.

According to the regulators' orders, bank traders manipulated foreign exchange rates in electronic chat rooms, typically just before trading closed for the day.

"In these chat rooms, FX traders at the Banks disclosed confidential customer order information and trading positions, altered trading positions to accommodate the interests of the collective group, and agreed on trading strategies as part of an effort by the group to attempt to manipulate certain FX benchmark rates. These chat rooms were sometimes exclusive and invitation only," the CFTC said in a statement.

In addition, the U.S. Office of the Comptroller of the Currency fined Citigroup, JPMorgan and Bank of America a total of $950 million for "unsafe and unsound practices.

Swiss regulators fined UBS about $135 million.

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