Serious Fraud Office steps up investigation of Forex traders
MP's have welcomed the latest announcement that the Serious Fraud Office (SFO) has stepped up its criminal investigation into traders who are accused of rigging the foreign exchange market, with interviews due to begin over the next few weeks. This includes the chatroom 'Cartel', of which its members are accused of conspiring to manipulate foreign currency rates. &nbsp;Damning messages from the chatroom were published by regulators in May as part of a &pound;3.7bn settlement involving six banks - Bank of America,&nbsp;Barclays, Citigroup, JP Morgan, Royal Bank of Scotland and UBS. Only one person has been charged so far for manipulating foreign exchange rates and there is growing pressure on the SFO to prosecute.
The Serious Fraud Office has stepped up its criminal investigation into traders accused of rigging the £3.5 trillion-a-day foreign exchange market.

Investigators are expected to begin interviewing former traders over the next few weeks, including members of a chatroom nicknamed the ‘Cartel’.

Last night one MP welcomed news that the net appears to be closing in on those involved in the extraordinary scam perpetrated by rogue traders at some of the world’s biggest banks.

Members of chatrooms calling themselves ‘the three musketeers’ and the ‘A team’ conspired to manipulate foreign currency rates. But the ‘Cartel’ was one of the most notorious.

Its members included Richard Usher, who moved from Royal Bank of Scotland to become JP Morgan’s chief currency dealer in London, and Chris Ashton who used to work at Barclays.

Other members included Rohan Ramchandani, who was Citigroup’s European head of spot trading and Matt Gardiner, who was at Barclays before joining Swiss giant UBS.

Damning messages sent by the men were published by regulators in May as part of a record £3.7billion settlement with US and UK regulators involving six banks.

These included Barclays and RBS which pleaded guilty to criminal charges.

Barclays received a fine of £1.5billion from US and UK regulators and RBS was hit with a £400million penalty, having also been fined £430million the year before.

One message from an employee at Barclays summed up their cavalier attitude: ‘If you ain’t cheating, you ain’t trying.’

Another message to a trader wanting to join the Cartel in 2011 to boost his bonuses said: ‘Mess this up and sleep with one eye open at night.’

Douglas Carswell, Ukip MP, said banks have misused billions of pounds in taxpayer support by manipulating financial markets.

‘It’s good that the SFO are taking it seriously. They have to go where evidence takes them,’ he said.

Last night one MP welcomed news that the net appears to be closing in on those involved in the extraordinary scam perpetrated by rogue traders at some of the world’s biggest banks

‘Over the past decade billions of pounds of money has been spent giving welfare handouts to banks. If a constituent of mine fiddled their welfare payments they would receive criminal charges.

So when banks are guilty of doing the same they need to be taken to task and have the book thrown at them.’

Usher and Ramchandani are among those challenging City watchdog the Financial Conduct Authority in court.

They say the FCA identified them in final notices accompanying fines and that they were never given the chance to defend themselves.

The SFO has already charged 13 individuals involved in a separate scam to rig Libor interest rates.

One of them – a former senior banker – has pleaded guilty but his identity has been protected by the courts.

Only one person has been charged so far for manipulating foreign exchange rates – although dozens have been suspended for being part of the conspiracy.

There is growing pressure on the SFO to prosecute rogue traders.

Despite a series of banking scandals since the financial crisis, not a single senior banker has gone to jail.

Earlier this month Bank of England Governor Mark Carney vowed to crack down on corruption, warning: ‘The age of irresponsibility is over.’

Maximum jail sentences for those caught rigging financial markets will be increased from seven years to 10 years. The sentences – which only applied to Libor rigging – are also being applied to foreign exchange and other markets.

In a separate move, banks will be given powers to claw back bonuses from senior managers up to 10 years after they were awarded.