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Nine banks agree to pay US$2b to settle forex rigging suit

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US banking giant JPMorgan Chase agreed to pay US$99.5 million in January, followed by Bank of America at US$180 million, Citigroup at US$394 million and Swiss UBS at US$135 million.

[NEW YORK] Nine major banks accused of foreign-exchange rigging have agreed to pay more than US$2 billion to investors in settlements, a law firm involved in the process said Thursday.

Plaintiffs have "reached settlements totaling more than US$2 billion with Bank of America, Barclays, BNP Paribas, Citi, Goldman Sachs, HSBC, JPMorgan, RBS and UBS," legal firm Hausfeld said in a statement published after a hearing in New York.

Hausfeld, which represented investors, gave no indication how the sum would be divided between the banks and said that the agreements were preliminary and must still be approved by US District Judge Lorna Schofield.

In June, sources close to the situation reported that Barclays would pay US$375 million, HSBC US$285 million, BNP Paribas nearly US$100 million and Goldman Sachs about US$130 million. But they also specified that the amounts were subject to change.

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None of the banks responded immediately when contacted by AFP.

Some of the banks in Thursday's announcement had already agreed to specific sums.

US banking giant JPMorgan Chase agreed to pay US$99.5 million in January, followed by Bank of America at US$180 million, Citigroup at US$394 million and Swiss UBS at US$135 million.

"In addition to the billions of dollars in compensation, these settling banks have agreed to cooperate with investors in their continuing litigation" against other institutions, Hausfeld said.

Thursday's agreements are distinct from proceedings led by US and British regulators, which in May ordered US$6 billion in fines on six major banks - Barclays, JPMorgan Chase, Citigroup, Royal Bank of Scotland, UBS and Bank of America - for rigging foreign exchange market and Libor interest rates.

Barclays, JPMorgan Chase, Citigroup and the Royal Bank of Scotland all pleaded guilty to US Justice Department charges of conspiring to manipulate the massive currency market.

"While the recoveries here are tremendous, they are just the beginning," said Hausfeld chairman Michael Hausfeld.

"Investors around the world should take note of the significant recoveries secured in the United States and recognise that these settlements cover a fraction of the world's largest financial market," he said.

The firm also noted that it was considering "concerted action" in London.

AFP

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