Economy

Former HSBC banker found guilty of fraud in the US

A former HSBC currency trader has been found guilty of defrauding Cairn Energy over a $3.5bn (£2.7bn) client order, following a month-long trial in NY.

A witness for the prosecution said nearly two thirds of sterling's trading on a major platform were dominated by HSBC traders in the five minutes before the deal.

Mark Johnson, a British citizen and former HSBC's global head of foreign exchange trading, was accused of defrauding Scottish oil and gas developer Cairn Energy PLC by front running its currency exchange order.

In June, another United Kingdom banker, Stuart Scott, was arrested in the United Kingdom at the request of U.S. authorities, for the case.

While banks have admitted to conspiracy in currency trading, this suit was the first to target individuals.

Johnson, who was on trial for almost four weeks, will be sentenced at a later date. But Scott remains in the United Kingdom fighting extradition to the U.S.to face charges.

They alleged that Johnson and Scott, on behalf of HSBC, bought sterling ahead of the deal, inflating the currency's value and ultimately netting a profit.

Prosecutors said Johnson and another former HSBC executive, Stuart Scott, who is also facing charges, devised a scheme to drive up sterling by executing a series of trade before carrying out the trade for Cairn.

Mark Johnson, a British citizen, was arrested in dramatic fashion in NY last July as he was about to board a plane to London.

The 51-year-old was the first banker to be tried in the United States as a result of worldwide investigations into the wider multi-trillion dollar per day currency market.

To make their case, USA prosecutors played audio recordings of phone calls between Mr Johnson and traders in London and NY, including one where he said, "I think we got away with it".



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