Tuesday 25th October 2016                 Change text size:

Barclays faces probe into foreign exchange scandal

barclays phone

Barclays has admitted to launching a probe into its foreign exchange trading operations. The bank, which was also implicated in the Libor scandal, faces further damage to its reputation.

Several banks have launched investigations over the potential manipulation and rigging of the foreign exchange market, including UBS and Deutsche Bank.

Barclays said it has received enquires regarding the investigation, confirmation came in its third quarter results statement.

The bank said, “It is not possible at this stage for Barclays to predict the impact of these investigations on it.”

The results statement also revealed that over the last nine months its pre-tax profits have fallen 20% to £4.97 billion. The bank said the fall was due its Transform restructuring program. Profits from its investment banking arm also dropped by half during the third quarter.

Barclays has been involved in a number of scandals recently.

Last year, Barclays was forced to pay £276m for its part in the Libor scandal. The scandal involved a series of fraudulent actions connected to the London Interbank Offered Rate and a number of other financial institutions have been fined or are under investigation.

Last month it was also revealed that Barclays could face a £50m fine for acting ‘recklessly’ during a deal with Qatari investors in 2008. The Financial Conduct Authority (FCA) accused the bank of agreeing £322m in secret payments to investors in order to secure their support for cash calls.

The bank has also has to set aside £3.95 billion to cover compensation for mis-sold payment protection insurance (PPI).

During the summer the bank’s shares fell sharply after it announced new shares in order to cover a £12.8bn shortfall in capital. The shortfall followed new regulation to protect banks form the risk of investment losses.

Further reading:

Barclays faces £50m fine for acting ‘reckless’ in Qatar bailout

Barclays suffers price drop after issuing £5.68bn in new shares

Banking regulator fines RBS £5.6m for inaccurate transaction reporting

Complaints against banks fall by 500,000 in the first half of 2013

Bank switching scorecard launched to help customers find ‘something better’

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