According to rumors running rampant in the media, we are all breathlessly awaiting an announcement, perhaps at 10 a.m., that the United States Department of Justice (“DOJ”) has settled its pending currency market rigging case with JPMorgan Chase, Citigroup, Barclays, the Royal Bank of Scotland (“RBS”) and UBS. Word has it that the five banks will be pleading guilty to criminal antitrust and fraud charges attendant to their manipulation of the foreign-exchange markets (“FOREX”).
Well, at least some if not all of the banks will be pleading – alas, the vagaries of last-minute rumors. And, sure, the spin will likely be that it wasn't actually the banks that did this but a small group of renegade employees, who conspired sub rosa and unbeknownst to the higher-ups who actually ran the banks. Then there's that thing about the higher-ups because, you know, those higher-ups who were running things at the times cited by DOJ have largely moved on and out and there is a whole new cadre of higher-ups, untainted by this current scandal. I'm guessing (going out on a limb here) that the banks will argue we shouldn't blame a humongous international organization for the misdeeds of a few out-of-control traders who kept it all off the firms' state-of-the-art compliance radar screens. READ