Traders Said to Rig Currency Rates to Profit Off Clients

[marmar]

(Bloomberg) Traders at some of the world’s biggest banks manipulated benchmark foreign-exchange rates used to set the value of trillions of dollars of investments, according to five dealers with knowledge of the practice.

Employees have been front-running client orders and rigging WM/Reuters rates by pushing through trades before and during the 60-second windows when the benchmarks are set, said the current and former traders, who requested anonymity because the practice is controversial. Dealers colluded with counterparts to boost chances of moving the rates, said two of the people, who worked in the industry for a total of more than 20 years.

The behavior occurred daily in the spot foreign-exchange market and has been going on for at least a decade, affecting the value of funds and derivatives, the two traders said. The Financial Conduct Authority, Britain’s markets supervisor, is considering opening a probe into potential manipulation of the rates, according to a person briefed on the matter.

“The FX market is like the Wild West,” said James McGeehan, who spent 12 years at banks before co-founding Framingham, Massachusetts-based FX Transparency LLC, which advises companies on foreign-exchange trading, in 2009. “It’s buyer beware.” .........................(more)

The complete piece is at: http://www.bloomberg.com/news/2013-06-11/traders-said-to-rig-currency-rates-to-profit-off-clients.html

[HiPointDem]

1. the entire financial system is rigged to benefit the 1% and screw the rest.

[xchrom]

2. du rec.

[liberal N proud]

3. Next thing they will tell you is that the gas prices are fixed

This is not a revelation by any means, anyone who observed the system can easily see that this all a big game of monopoly played by the privileged.

[faithnomore]

4. You don't have to be smart to be rich..........

You just have to be a goddamn crook....

[roomtomove]

5. currency transfers are also rigged

From my own personal exprience, i transferred an inheritance from another country to Chase Bank here, and lost about 3% of the value based on the currency exhange rates. I could never determine whether it happened here or there.

[Egalitarian Thug]

11. It doesn't matter. As long as a bankster is involved, you lose. n/t

[fasttense]

6. Capitalism is a rigged game

And now you see some of the rigging. It's not your fault you can't seem to get ahead, the whole system is past its expiration date. Capitalism has run its course and is in the destruction, rotting and foul smelling stage. Now is the time to replace it.

[ReRe]

7. Hear! Hear! ;-) n/t

[Dustlawyer]

8. I think Capitolism could still be saved, but would have to be tweaked. The main thing causing

most of the problems is the campaign finance rules. Without public financing of elections, our current system of legalized bribery has resulted in a loss of Representative Democracy. The Lobbyists have bought off most of the politicians and regulatory agencies. They control much of the Judiciary and the media as well. Our corruption is at epidemic levels and yet the vast majority of Americans are brainwashed Republicans and Democrats, apathetic individuals, or just plain ignorant! Corruption is in any system, the difference is the extent of it. Here in America it is worse than most Banana Republics, yet regular Americans choose to ignore what is going on.

[reformist2]

10. Freedom and democracy made America great, not 'free-market' capitalism.

When you really get down to the nitty-gritty of all the social and moral and technological and medical advances we've made, you'll be hard pressed to find a billionaire capitalist among the list of anyone deserving our thanks and praise.

[Egalitarian Thug]

9. Thank god it passed.

& R

[reflection]

13. I bet that poster never thought

that he would be immortalized by that ridiculous post. Even though he's gone, his thoughts live on.

Greatest post ever IMO, second only to http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=364&topic_id=1871714

[Egalitarian Thug]

14. Thanks. I've seen that phrase before but never knew the context (or that there was one).

The TGIP one found its way over to Kos. This is the earliest one I found, is it the origin?

[reflection]

15. Yes, as far as I know.

OMC was a trip. And His Posts Were Easy To Spot.

[snot]

12. " . . . . there are no specific rules or agencies governing spot foreign-exchange trading in Britain

* * * * *

"Sixteen of the largest banks, including Barclays, JPMorgan Chase & Co. (JPM) and Deutsche Bank (DBK), signed a voluntary code of conduct for foreign-exchange and money-market dealers in 2001 . . . .

* * * * *

"'The thing about the code is it is a voluntary code,' the lawyer said. 'It may be that compliance with that has almost been seen as optional.'"

Duh!