Matt Levine, Columnist

Front-Running and Retail Banking

Also Venezuela, early earnings and so much blockchain.

October 24, 2017 at 1:40 PM UTC

Matt Levine is a Bloomberg Opinion columnist. A former investment banker at Goldman Sachs, he was a mergers and acquisitions lawyer at Wachtell, Lipton, Rosen & Katz; a clerk for the U.S. Court of Appeals for the 3rd Circuit; and an editor of Dealbreaker.

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HSBC.

In 2011, traders at HSBC Holdings Plc got a big order to buy $3.5 billion worth of pounds sterling for a corporate client at the 3 p.m. fixing price. "Ohhhh, f***ing Christmas," responded HSBC trader Mark Johnson. (To his colleague, I mean. They kept a straight face to the client.) HSBC proceeded to buy sterling in the minutes leading up to the 3 p.m. fix, pushing up the price. By the time of the fix, that price was pretty high -- higher than the average price HSBC had paid -- and it was able to sell the client the pounds it had bought at a big premium, making about an $8 million profit. Years later, U.S. authorities decided that this was a crime, and charged Johnson with that crime, and yesterday he was convicted of the crime.