By Christina Rexrode
The Office of the Comptroller of the Currency fined the three
biggest U.S. banks by assets a combined $950 million on Wednesday,
saying that Bank of America Corp., Citigroup Inc. and J.P. Morgan
Chase & Co. tried to manipulate the foreign-exchange market to
boost their own profits.
Citigroup and J.P. Morgan will pay $350 million each and Bank of
America will pay $250 million.
The OCC also ordered the banks to shore up their systems for how
they monitor foreign-exchange traders and detect bad behavior, and
said that misdeeds by traders went undetected by the banks for
years. The three banks did not admit or deny wrongdoing, but agreed
to comply with the OCC's orders.
The OCC's announcement came just nine hours after the U.K.'s
Financial Conduct Authority and another U.S. regulator, the
Commodity Futures Trading Commission, announced foreign-exchange
settlements with five banks, including Citigroup and J.P. Morgan.
Bank of America was not a part of those settlements.
The OCC's findings echoed those of the FCA and the CFTC:
According to the OCC settlements, traders colluded with colleagues
at other banks, communicating via online chat rooms to discuss how
they could manipulate the rates for their own benefit and sharing
confidential information about their clients' orders.
The regulator ordered the banks to tighten their methods for
monitoring their foreign-exchange traders and rooting out potential
bad behavior. For example, the OCC requires them to develop formal
processes for sharing news of potential problems across their audit
departments, and to review what other trading activities could
raise similar market concerns.
Write to Christina Rexrode at christina.rexrode@wsj.com