Barclays to pay another $50 million for US currency rigging settlement
Feb 20, 2016 01:46 AM EST
Barclays has already agreed to pay $50 million to settle a U.S. currency lawsuit. The court case is claiming that Barclays rigged its foreign exchange trading system to decline client orders that the British Bank could not earn profit from.
According to Reuters UK, Barclays Plc already decided to shell off $50 million or £34.8 million just to clear up the U.S. court case that alleged it manipulated its foreign exchange trading system. The initial, all-cash agreement with the investors was led by Axiom Investment Advisors LLC. However, it was dissolved in papers filed on Wednesday night in the U.S. District Court in Manhattan, and requires a judge's authorization.
This decision came three months after Barclays agreed to pay $150 million. Then terminated a senior electronic trading official to resolve similar allegations by the New York State State Department of Financial Services.
On the other hand, Barclays denied all of the offence as they agreed to settle in court. Mark Lane, a bank spokesperson also refused to comment regarding the allegations. Christopher Burke, a lawyer for the plaintiffs, also did not immediately acted in response of the request to comment on Thursday, as reported by Yahoo! Finance.
The complaint came after the "Last Look," which is a Barclays feature that is meant to put off traders from having a few milliseconds of delays in the flow of information within the marketplace. And as an alternative, the New York regulator revealed that Barclays used Last Look as a "general filter" to unprofitable trades, while it gave inaccurate responses to clients who asked why their trades were declined.
Axiom, which is based in Manhattan, also made a statement that Barclays' activity caused "significant damages" for its foreign exchange counterparts. The actions made by the bank also amounted to breach of contract or fraud.
But Barclays tried to revise "Last Look" in September and October 2014. It is an effort to reject trades that are believed to be "sufficiently unprofitable" for both customers and the bank. However, this will not only benefit the bank, the New York regulator claimed.
In an internal message, the head trader also instructed the workers to "avoid mentioning" the "Last Look" features to Barclays sales staff. "If you get enquiries just obfuscate and stonewall," the email mentioned. And in a statement via The New York Times, Barclays also stated that it "continues to cooperate with other ongoing investigations and to manage related litigation risks as previously disclosed."
Meanwhile, Barclays is just among some of the banks that settled a private U.S. litigation over accusations of currency rigging. But the "Last Look" features were still not covered in its court settlement.