US regulatory authorities have spent the last four years sharpening their teeth amidst a litany of trading scandals, market manipulations, and other forms of abuse. This week, three former UK currency traders step into the lion’s den so to speak, to stand trial for allegations and charges of market manipulation dating back to 2013.
The focus of the investigation is ‘The Cartel’, which had been exposed as individuals sharing sensitive information regarding currency markets in an electronic chatroom. Today’s trial will include former JPMorgan Chase & Co. trader Richard Usher, former Citigroup trader, Rohan Ramchandani, and former-Barclays Plc trader Chris Ashton.
The global FX industry was upended nearly four years ago after a massive rate-rigging scandal engulfed some of the largest banks globally. This resulted in record fines against lenders, which totaled nearly $10 billion from a plethora of US and European regulatory authorities – lenders have still not been able to fully shake off the residual impact of these fines, with many having since been forced to restructure their operations.
Initial court appearance
All three UK traders have had a lengthy trip, coming over to the US to appear in a NYC court to enter into initial plea agreements, according to a Bloomberg report. Consequently, preliminary bail accounts have been set – $650,000 for Mr. Usher, $1.0 million for Mr. Ramchandani, and $200,000 for Mr. Ashton, citing regulatory filings.
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Today’s trial marks the next step after months of back and forth negotiations dealing with their surrender, treatment, trial in the US, and extradition – the latter issue is convoluted given that it has the potential to scuttle the hearing altogether due to delayed visa approvals.
All eyes on Manhattan
A lengthy probe and consequent rounds of negotiations have paved the way for today’s initial hearing for the three former currency traders. All three individuals have bolstered their defense with a decorate staff of lawyers, and have all pleaded innocence to the charges against them. The rigging of a $5.3 trillion a day currency market has caused the axing of many top jobs and record fines, with this week’s trial bearing witness to the lingering aftershocks and loose ends of the scandal, even after four years.
One thing working in each individuals’ favor is a recent ruling in 2016 from the UK’s Serious Fraud Office (SFO), which stands as their best chance to date for total absolution. The SFO opted to close its investigation of Mr. Usher, Ramchandani, and Ashton, rendering all three men blameless. However, today’s charges and consequent hearing come from the US authorities.
That being said, all three individuals voluntarily traveled to the US to reconcile the charges. Mr. Usher previously served as JPMorgan’s Chief Currency Dealer in London, Mr. Ramchandani worked at Citigroup as its Head of G-10 Spot Currency Trading and Mr. Ashton worked as the Head of Global Voice Spot Trading at Barclays.
If history is any correlation, LIBOR trials had also seen similar circumstances and complications involving extradition – these trials were however completed without prolonged extradition conflicts, which bodes well for all three former currency traders in Manhattan today.
A future trial date is likely to be scheduled and Finance Magnates will update its coverage as the story develops.