OCC Fines Three U.S. Banks Almost $1 Billion in FX-Rigging Probe

Citigroup Inc., JPMorgan Chase & Co. and Bank of America Corp. agreed to pay almost $1 billion to settle a foreign-exchange manipulation probe in an accord announced by the Office of the Comptroller of the Currency.

The settlement with the U.S. banks follows penalties from U.K., Swiss and U.S. regulators announced earlier today. With the OCC’s $350 million fine, Citigroup becomes the most penalized of six global banks, agreeing to pay a total of $1.02 billion to settle accusations it rigged key benchmarks. JPMorgan will also pay the OCC $350 million, and Bank of America will pay $250 million, the agency said.

“The OCC will take forceful action, not only when the institutions we supervise engage in wrongdoing, but when management fails to exercise the oversight necessary to ensure that employees follow laws and regulations,” Comptroller of the Currency Thomas Curry said in a statement today. His agency found several years of misconduct by bank employees that the firms’ internal oversight failed to prevent.

Britain’s Financial Conduct Authority, the U.S. Commodity Futures Trading Commission and Switzerland’s Financial Market Supervisory Authority coordinated the actions with the OCC, bringing total penalties to about $4.3 billion. The FCA, CFTC and Swiss regulators also fined UBS AG, Royal Bank of Scotland Group Plc and HSBC Holdings Plc.

Regulators and law-enforcement agencies are expected to target additional banks with penalties as a result of dealers colluding with counterparts at other firms to rig benchmarks used by fund managers to determine what they pay for foreign currencies.

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