Citibank, JPMorgan, and other banking giants are facing a potential class action lawsuit over ripping off clients on currency trades, report says

• Allegations of currency-trade manipulation are bubbling up into a potential class-action suit against several big banks.
• The banks, which include UBS, Barclays, Citibank, and JPMorgan, are accused of colluding to rig prices in the foreign-exchange market.
• In sum, banks have paid north of $12 billion in fines over FX rigging.

Allegations of currency-trade manipulation are bubbling up into a potential class-action suit against several big banks, according to a report from the Financial Times.

Two high-powered legal teams are jostling to bring a collective action against the banks in London courts, pursuing a US-style class-action strategy that could lead to huge payouts. Under a 2015 UK law, class-action suits can be pursued if there are suspected violations of competition law in play, according to the FT.

The banks, which include UBS, Barclays, Citibank, and JPMorgan, are accused of colluding to rig prices in the $6 trillion foreign-exchange market between 2007 and 2013. Traders allegedly coordinated currency bets in online chat rooms, exchanging information on customer orders and prices.

In 2019, the banks coughed up over €1 billion in fines to the European Commission, following on similar fines paid to US, UK, and Swiss regulators. In sum, banks have paid north of $12 billion in fines over the FX-rigging scandal, according to the FT.

UBS initially escaped the 2019 European fines by disclosing its misconduct early, but the regulatory action was effectively an "open invitation for parties who may have been impacted by these cartels to sue these banks," as one lawyer told the BBC at the time.

That prediction now seems prescient as the two competing class-action cases are being bankrolled by litigation financiers who buy equity in the outcome of a case.

Separately, HSBC is facing allegations from a former client of FX fraud in front of London's High Court. HSBC denies the claims.