Six FX traders involved in the currency manipulation case are expecting a cold-turkey as UK bank RBS confirms disciplinary action in a year-end note. The bank, one of five that faced monetary fines in November has been clamping down on its internal investigation. The current news comes as no surprise as the shadow of the forex rates crisis is still hovering over the city.
RBS provided a detailed update on the current status of its enhanced investigations into the forex rigging scandal at the bank. The bank mentioned that six individual traders are to face disciplinary action, with three of the six already under suspension. Furthermore, adding salt to the wounds of banks and their emphatic bonuses is the fact that 18 bankers are to be exempt from bonus payments until the investigations are completed.
RBS’s Head of Conduct and Regulatory Affairs Jon Pain commented in a statement, “We are undertaking a robust and thorough review into the actions of the traders that caused this wrongdoing and the management that oversaw it. This is a complicated process but also an essential one in order to identify culpability and accountability for this unacceptable misconduct.
“To be clear no further bonus payments will be made or unvested bonus awards released to those in scope of the review until it has concluded and its recommendations have been considered by the Remuneration Committee and the Board Risk Committee.”
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Banks faced the limelight last month when authorities in the UK, Switzerland and USA issued substantial penalties against their failings to supervise the currency manipulation that has rocked the global financial marketplace. The banks in question paid a combined $4.25 billion last month to settle the civil matter. Edinburgh-based RBS settled fines with the three regulators for $634 million.
RBS like its peers has taken the matter seriously and has implemented additional resources for the matter. Last year, it employed Jon Pain as group head of Conduct & Regulatory affairs, from KPMG where he was a partner and head of the Financial Services Risk Consultancy practice.
Mr. Pain is a veteran in the regulatory sector having served at the UK regulatory authority, the FSA, as managing director of supervision during the crisis (2008 – 2011), according to the RBS website.
Mr. Pain adds: “There is no place for any misconduct at the RBS we are building. We want to get these things settled so we can put these issues behind us and get on with rebuilding trust in this bank.”
RBS is eighty one percent owned by the UK government after facing sustainability issues post 2008 global recession.