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Who isn’t probing banks’ alleged currency rigging?

Robert Peston
Economics editor

image copyrightReuters

New York's Department of Financial Services is very much the late arrival to the worldwide investigation into whether up to 15 huge global banks manipulated the foreign exchange market.

But its request for documents from banks will disturb them, because it has a reputation for being particularly aggressive - as the UK bank Standard Chartered found to its cost when the Department of Financial Services pursued it for breaches of money laundering rules.

A dizzying number of regulators are looking at this latest alleged scandal, including the Financial Conduct Authority in the UK, the Department of Justice, the New York Fed, the Office of the Controller of the Currency and the Commodity Futures Trading Commission, all in the US, Bafin in Germany and Finma in Switzerland.

I am told that the competition authorities in Brussels are also thinking about getting involved.

In the UK, RBS, Lloyds and Barclays are all reviewing thousands and thousands of emails and instant messages sent by their currency traders, to assess whether they attempted to rig prices.

It is looking very messy and expensive for the big banks - with Martin Wheatley, the chief executive of the FCA, having told MPs yesterday that the allegations against them are every bit as bad as their abuses of the Libor interest-rate market.

Which implies that as and when the investigations conclude, probably next year, fines and penalties could run to billions of pounds.