Economy

HSBC Fined USD175 Million Over "Unsafe" Forex Practices

HSBC Fined USD175 Million Over

HSBC Holdings PLC (HSBA.L) has been slapped with a $175 million fine by the U.S. Federal Reserve board as the central bank found a long pattern of "unsafe and unsound practices in the foreign exchange (FX) markets".

The Fed order released Friday detailed multiple instances of improper behavior, including allegations that traders may have conspired with counterparts at other firms to coordinate strategies to influence market prices.

"We are pleased to have resolved this matter", HSBC said in an emailed statement.

The regulator ordered HSBC to improve risk management in its foreign-exchange business. The Fed said the bank cooperated with the investigation.

The penalty comes as HSBC's former head of foreign exchange spot trading, Mark Johnson, is facing trial in NY federal court over allegations that he and others traded on inside information about a $3.5 billion cash swap.

The bank in 2012 paid $1.9 billion in fines and other charges after settling with USA prosecutors over allegations it had deliberately moved money for drug cartels, clients tied to terrorist organizations and sanctions-barred countries, or failed to prevent this.



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