According to the recent reports from the U.S. media, the country’s two most powerful watchdogs – The U.S. Federal Reserve and the Office of the Comptroller of the Currency – has sent investigators to visit Citigroups’s London headquarters for probing into an alleged forex manipulation scam.
The representative of both the U.S. organizations have been investigating the Citigroup’s top officials from one week into the company’s Canary Wharf base in the East of London. Incidentally, Citi had fired Rohan Ramchandani, its head of European Spot Foreign Exchange Trading, on the grounds of prolonged leave.
Citigroup’s spokespersons declined to comment on their former employee’s sacking.
The investigations done by the U.S. authorities are believed to be in its early stages, and have also been speculated to be uninspired from Rohan Ramachandran’s dismissal from the very position that could have been under a magnifier.
What exactly happened?
The latest developments in the matter alleged that traders from some of the biggest banks jointly conspired to manipulate the $5.3 trillion a day global currency market. The Feds and OCC officials suspect the role of both Citi and Deutsche – the biggest banks in the forex market. Deutsche meanwhile have suspended a shocking number of traders in New York and elsewhere in the U.S. that ignited the U.S. authorities’ investigations into the matter.
Last year, the U.K.’s Financial Conduct Authority had also begun an investigation into the Deutsche Bank’s alleged involvement in manipulating the Forex industry. Earlier, the bank paid a hefty fine of €725m (£604m) after being proved to have manipulated the interest rates in December.
Presently, the statement released by the bank however suggests that the bank would not comment on its staff member but will give support to U.S. investigating and regulatory authorities. The bank also guaranteed to take the necessary disciplinary action against any individual who is proved guilty during the whole process.
Other than Citigroup and Deutsche, it is UBS, JP Morgan, Barclays, RBS, and other that are said to have cooperating with the market’s scrutinizers.
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