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Ex-HSBC banker Scott arrested in UK in American FX case

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While his former colleague was arrested as he was about to board a plane at a New York City airport in July, Stuart Scott, the former head of HSBC Holdings Plc's currency trading in Europe, has remained free at home in suburban London.

[LONDON] While his former colleague was arrested as he was about to board a plane at a New York City airport in July, Stuart Scott, the former head of HSBC Holdings Plc's currency trading in Europe, has remained free at home in suburban London.

That came to an abrupt end on June 5 when UK authorities arrested Scott, 44, at the request of the American government, federal prosecutors told a US judge in Brooklyn, New York, in a letter filed late Wednesday. He appeared at a London court on the same day and was bailed for £100,000 (S$178,437), a UK court clerk said by phone Thursday.

Since last year, prosecutors have been attempting to bring Scott to the US to face charges that he and Mark Johnson schemed to rig foreign-exchange markets, in the first American case of its kind. Johnson, HSBC's global head of foreign-exchange cash trading in London, has pleaded not guilty and is free on bond. 

Scott "conspired with others to defraud Cairn Energy Plc within the territory of New York", according to the charge listed in UK court filings and a two-day extradition hearing is scheduled for July 31 at Westminster Magistrates' Court in London, the court clerk said.

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Johnson and Scott allegedly manipulated the pound in a front-running scheme to take advantage of inside information about a client's US$3.5 billion currency transaction, reaping US$8 million for the bank. Scott, who reported to Johnson, left the bank in 2014. His lawyer didn't immediately respond to a request for comment.

Should Scott decide to fight extradition to the US it could be at least another year until he's on a plane. The first court decision is usually appealed by the losing party and a back-log of cases in UK courts can see months go by between hearings.

Navinder Singh Sarao, the British trader accused of making US$40 million by spoofing markets from his bedroom, fought extradition for 18 months before he was sent to the US last year.

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