City & Finance Reporter for the Daily Mail
HSBC has been fined £130m for ‘unsound’ practices in its currency trading business
HSBC has been fined £130million for ‘unsafe and unsound’ practices in its currency trading business.
The penalty was issued because the bank failed to stop traders using inside information from clients.
It comes as former HSBC trader Mark Johnson, who is British, is tried in New York for allegedly making gains from a £3billion currency deal.
Johnson denies ‘front-running’ a deal made by British firm Cairn Energy by buying the sterling ahead of the transaction and then netting the bank billions of dollars when it went up and he sold later.
With regards to the fine, the Fed said HSBC ‘failed to detect and address its traders misusing confidential customer information, as well as using electronic chatrooms to communicate with competitors about their trading positions’.