It’s a story we’ve been following very closely last year. In fact it made it into our 2011 free forex industry report.
BNY Mellon was accused by many clients for overcharging them in forex transactions. BNY Mellon was accused of over charging its pension fund clients for FX transactions resulting in over $2 billion of ‘excess’ fees paid by the pension funds.
Now it seems the bank may settle. aiCIO reports:
Filling the Gap Between Brokers, LPs, and ClientsGo to article >>
After months of controversy surrounding issues over foreign exchange transactions, BNY Mellon, the world’s largest custody bank, is continuing to work toward a settlement as part of a lawsuit filed by federal prosecutors.
The suit against the bank alleges that it fraudulently overcharged clients for currency trades, with the lawsuit aiming to resolve the way BNY Mellon discloses the pricing of those transactions. Following a request for a one-week extension in the federal case that was granted on January 9, judge told the US attorney and the bank in a note obtained by aiCIO that “parties should not expect another extension from the court.”
As part of the suit, Manhattan US Attorney Preet Bharara, who filed the suit in October, is seeking damages of hundreds of millions of dollars. If a settlement is reached, sources say the suit may eventually offer a roadmap to better resolve other lawsuits over currency transactions.