HSBC suspends two forex traders

HSBC has suspended two traders dealing in the foreign exchange markets, according to reports, following an investigation being launched into possible rigging.

HSBC is just one of the bank under scrutiny, along with other major global banks, after global regulators launched an investigation into allegations of manipulation within the foreign exchange markets (forex).

The BBC reported on Friday that HSBC had suspended two traders, the same day that Citigroup said that it had also suspended some of its employees.

Regulators from the UK, Switzerland, the US and Hong Kong set their sights on the euro-dollar market back in November, and the suspensions come as the investigation thickens.

Other banks being investigated as part of the scandal include Goldman Sachs, Barclays, Morgan Stanley, HSBC, the Royal Bank of Scotland (RBS), Standard Chartered, UBS and Deutsche Bank.

The forex markets, which trade around $5 trillion (£3 trillion) per day, are said to have been manipulated by traders by sharing information on trading ahead of their clients.

When the investigation was launched, Joaquín Almunia, the European competition commissioner, said that banks were fully complying with the regulators in the hope of being dealt with as leniently as possible.

Last week, Labour leader Ed Miliband set out his vision to radically shake-up the banking sector so that it served the needs of society, rather than society serving the banks.

Although Miliband’s announcement came under heavy criticism from businesses and the banking sector itself, some welcomed the measures, saying that banks need to have a “fundamental change in their reason for being”. 

Further reading:

Multinational banks face foreign exchange investigation

Royal Bank of Scotland could face new scandal and additional fines

Lloyds Bank sets aside further £750m for PPI claims

Barclays faces probe into foreign exchange scandal

JP Morgan nearing $13bn record banking fine over mis-selling