By Evan Weinberger
Law360, New York (August 13, 2015, 5:24 PM ET) — Barclays PLC, Goldman Sachs Group Inc., BNP Paribas SA, HSBC Holdings PLC and the Royal Bank of Scotland PLChave agreed to settle class action litigation alleging they manipulated the $6 trillion foreign exchange market, bringing the total settlements to more than $2 billion, plaintiffs attorneys said Thursday.
The settlement with the five banks comes on top of previously announced settlements that have seen Bank of America Corp., JPMorgan Chase & Co., UBS AG and Citigroup Inc. pay a combined $808.5 million in recent months.
Details of the individual settlements, which were announced in open court, were not immediately available. The dollar amounts will be made public within the next three weeks when settlement documents are filed, said David Scott, the managing partner of Scott & Scott LLP.
“The defendants were interested in putting this case behind them,” Scott said in an interview with Law360. “Every regulatory agency that has looked at this case around the world has found bad conduct, and I think banks around the world have been trying to make amends.”
Barclays, Goldman and HSBC declined to comment. Representatives for the other two banks whose settlements were revealed Thursday could not immediately be reached for comment.
The previous settlements were also announced in court Thursday, bringing the total settling banks to nine.
Specifically, the plaintiffs alleges that from as early as 2003 and through 2013, the banks used multiple online chat rooms – with names like “The Cartel,” “The Bandits’ Club” and “The Mafia” – to communicate in code to avoid detection.
“Being a member of certain chatrooms was by invitation only, indicating the secret nature of this conduct,” the complaint says, adding that the chat rooms “replaced the classic smoke-filled backrooms of the past.”
The banks are accused of fixing prices by agreeing to widen the difference between the prices at which they buy and sell currency, manipulating benchmark rates, and exchanging confidential customer information in an effort to trigger client stop-loss and limit orders, according to court records.
In the past year, JPMorgan Chase & Co. and JPMorgan Chase Bank NA agreed to pay $99.5 million in January; UBS AG, UBS Group AG and UBS Securities LLC settled for $135 million in March; Bank of America Corp. and Bank of America NA agreed to pay $180 million in April; and Citigroup Inc. and Citibank NA were required to pay $394 million in May. All except Bank of America were part of a broader, $5.6 billion settlement with U.S. and U.K. authorities in May.
Each of those settlements have included cooperation agreements.
Only Morgan Stanley, Credit Suisse AG and Deutsche Bank AG have not settled from the original group of banks that were named as defendants in the litigation.
However, the plaintiffs in late July named Japan’s Bank of Tokyo-Mitsubishi, Canada’s RBC Capital Markets LLC, France’s Societe Generale SA and Britain’s Standard Chartered PLC, bringing to 16 the number of defendant banks in the litigation.
“We are going to vigorously litigate against them and see if we can prevail,” Scott said.
The litigation over foreign exchange rigging could soon reach foreign courts. Scott & Scott has opened a London office to pursue claims there.