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Four banks have agreed to pay fines reaching more than £ 100m following an investigation by the UK competition guards found that employees used chat Bloomberg rooms to exchange sensitive information on gilded trading.
Citi, HSBC, Morgan Stanley and Royal Bank of Canada have agreed to resolve separate cases with the Competition and Market Authority for the behavior that took place between 2009 and 2013.
A small number of traders from the banks was revealed to have participated in “illegal” exchanges by sharing sensitive information in one-to-one Bloomberg conversations about the government’s bond prices in the UK
Deutsche Bank was also subject to open investigation by CMA in 2018, but received immunity to report its behavior, a common practice under regulatory softness policy, where “a business that is included in the card” helps in a Investigation.
Fines are the latest in a series of sentences given on global banks for sharing sensitive information in currency and bond markets. In 2021, the European Commission fined a group of € 371 million to participate in a card in the primary and secondary market for European government bonds, sharing prices and other sensitive information in the results of debt auctions.
HSBC, Morgan Stanley and RBC was given a 10 percent reduction in resolution after CMA raised its objections while Citi received a 55 percent discount, in part for the settlement before the regulator issued his objections.
“The fines imposed today reflect the CMA commitment to deal with violations of competition law and the prohibition of anti-competitive behavior,” said Juliette Enser, the executive director of the CMA competition in a Friday statement.
“The fines would have been significantly higher if banks did not take extremely broad steps to make sure this does not happen again,” she added.
Citi, Deutsche, HSBC and Morgan Stanley each had a UK -based merchant sharing information in bilateral Bloomberg conversations, while RBC had two. None of the traders still work for banks, said CMA.
Most of the information exchanged among banks in relation to prices in the auctions gilded. Traders in Deutsche Bank and RBC also coordinated in trading strategies for gilts “in a limited number of cases,” said CMA.
Deutsche and RBC also had the highest volume of messages with traders in banks exchanging information for 41 dates between November 2009 and April 2013.
Citi and Deutsche accepted their involvement before the CMA released its temporary findings in 2023 while HSBC, Morgan Stanley and RBC did not accept any wrongdoing. In statements sent to the Financial Times at the time, both RBC and Morgan Stanley said they disagreed with the regulator findings while HSBC said “rejects” the charges.
Morgan Stanley said Friday that “he had made the trade decision to withdraw a line under this long investigation of CMA”. An HSBC spokesman said the bank was “pleased to impose this investigation behind us”. Citi and RBC both said they were pleased to have resolved the matter.
All banks said their compliance has been significantly improved since incidents.
CMA did not say whether limited or distorted exchanges of market competition.
