Goldman Sachs, the indomitable US bank, has announced the dismissal of a currency trader they believe to have been involved in FX benchmark manipulation, recently exposed and made public via coordinated regulatory investigations.
The bank was not fined nor reprimanded in last week’s FX ‘settlements,’ but nevertheless chose to dismiss Frank Cahill, a trader who joined Goldman in 2012 after previous spells at HSBC and Barclays.
Upon joining HSBC from Barclays in 2010, the bank said the following regarding the appointment: “Frank is a talented trader and we look forward to welcoming him to the team, where he will run our GBP/USD book. His hire is part of our continued build-out of our overall product and distribution capability.”
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Mr. Cahill joined Goldman Sachs in October 2012 as vice president on the foreign exchange desk. “This relates to a period before he joined Goldman Sachs and he has now left the firm,”, according to a Goldman Sachs statement.
Given Mr. Cahill plied his trade at two of the fined banks and was specifically focused on sterling and US dollar transactions, it is quite possible that he was one of a number of unidentified HSBC and/or Barclays traders whose conversations in online chat rooms were quoted by regulators.
Until now, Goldman Sachs has avoided the spotlight in the currencies trading scandal. While at least a dozen banks suspended or fired more than 30 traders and sales people in relation to the investigation, Goldman Sachs has not taken any similar action with its staff.
Documents released by the FCA showed that HSBC traders used information gathered by dealers at other firms to pick out the best time and method for conducting transactions designed to boost their profits, sometimes at the expense of their clients. The FCA also said it identified instances where HSBC foreign exchange traders had tried to make money by triggering automatic client orders to buy or sell certain currencies.