Banks fined £2bn over forex failings

<p>RBS, HSBC and UBS among those who receive fines for manipulating forex</p>

UK and US regulators have fined five banks including HSBC and Royal Bank of Scotland £2bn for their attempts to manipulate foreign exchange rates, following a year-long investigation.

The UK's Financial Conduct Authority (FCA) and the US regulator, the Commodity Futures Trading Commission (CFTC) also issued the fines to Morgan Chase, Citibank and UBS, with a separate probe still ongoing into the conduct of Barclays.

Barclays is expected to settle with a similar deal later, with the bank releasing a statement to this effect this morning: "After discussions with other regulators and authorities, we have concluded that it is in the interests of the company to seek a more general coordinated settlement."

The colossal fine represents the largest penalisation on record issued by the FCA or its predecessor the Financial Services Authority.

"At the heart of today's action is our finding that the failings at these banks undermine confidence in the UK financial system and put its integrity at risk," a statement from the organisation read.

The investigation found that the banks had not exercised adequate and effective control over their foreign exchange trading businesses and that training failed to enforce the right values and cultures.

It also criticised the banks for allowing their traders to form tight-knit groups who then shared information about client activities in order to undermine the forex market.

Chancellor George Osborne claimed that the fines represent a long-term plan that will eventually fix all that is wrong with the integrity of Britain's financial markets. 

A number of senior traders have been put on leave while the Serious Fraud Office prepares potential criminal charges against those who are alleged to have masterminded the scheme.

The Bank of England, meanwhile, has published a separate report by Lord Grabiner that clears its officials of being involved, in the face of accusations to the contrary.

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