DOJ Obtains Guilty Pleas, Fines from Five Banks Relating to Foreign Currency Manipulation | Practical Law

DOJ Obtains Guilty Pleas, Fines from Five Banks Relating to Foreign Currency Manipulation | Practical Law

As part of its investigation into the manipulation of foreign currency exchange rates, the Department of Justice (DOJ) forced guilty pleas from Citigroup, JPMorgan Chase, Barclays and the Royal Bank of Scotland (RBS), and voided non-prosecution agreements with UBS and Barclays.

DOJ Obtains Guilty Pleas, Fines from Five Banks Relating to Foreign Currency Manipulation

by Practical Law Antitrust
Published on 20 May 2015 • USA (National/Federal)
As part of its investigation into the manipulation of foreign currency exchange rates, the Department of Justice (DOJ) forced guilty pleas from Citigroup, JPMorgan Chase, Barclays and the Royal Bank of Scotland (RBS), and voided non-prosecution agreements with UBS and Barclays.
On May 20, 2015, the Department of Justice (DOJ) announced that it obtained guilty pleas at the parent level from four major banks for those banks' involvement in manipulating the price of US dollars and euros in the foreign currency exchange (FX) spot market. The banks and fines include:
  • Citicorp, fined $925 million.
  • Barclays, fined $650 million.
  • JPMorgan Chase, fined $550 million.
  • Royal Bank of Scotland (RBS), fined $395 million.
The DOJ also obtained guilty pleas at the parent level from UBS and Barclays for their roles in manipulating the London InterBank Offered Rate (LIBOR) and other benchmark interest rates. The DOJ fined Barclays and UBS for violating 2012 non-prosecution agreements (NPAs) intended to resolve the DOJ's LIBOR investigations into those banks. The DOJ found that both banks breached the terms of their NPAs by engaging in deceptive FX conduct after the NPAs were signed. For violating the non-prosecution agreements:
  • Barclays agreed to a criminal penalty of $60 million.
  • UBS agreed to a criminal penalty of $203 million.
All five banks also agreed to a three-year corporate probation.
The DOJ noted that the plea agreements do not prevent the DOJ from prosecuting individuals for related misconduct.
In connection with the FX investigation, the Federal Reserve concurrently announced that it fined the five banks over $1.6 billion. Taken with international fines and previously announced fines, the FX investigation has to-date led to fines totalling nearly $9 billion.
DOJ Assistant Attorney General Bill Baer applauded the guilty pleas in a speech made shortly after their announcement.
For more information on the LIBOR cartel, see DOJ LIBOR Manipulation Investigation Chart.