Banks Fined Nearly £4bn Over Exchange Abuses

Barclays (LSE: BARC.L - news) , Royal Bank of Scotland (LSE: RBS.L - news) and three other banks have been fined almost £4bn over the manipulation of foreign exchange and currency rates.

Four of the institutions - JPMorgan Chase, Citigroup (NYSE: C - news) , Barclays and RBS - have agreed to plead guilty to US criminal charges over manipulation of foreign exchange rates, the US Department of Justice said.

The fifth bank, UBS (NYSEArca: FBGX - news) , will plead guilty to rigging benchmark interest rates, the department added.

In the final settlements under the foreign exchange (forex) market probe, Barclays agreed a £1.53bn fine with US and UK authorities, including £284.4m to Britain's Financial Conduct Authority (FCA).

Royal Bank of Scotland agreed to pay a further £430m to US authorities, which comes on top of a £399m penalty last November to regulators on both sides of the Atlantic.

JPMorgan Chase will pay $550m (£353m) and Citigroup will pay $925m (£595m) in criminal fines as part of their guilty pleas.

As part of a New York banking regulator's agreement, Barclays will also fire eight bank employees involved with rigging foreign exchange rates, the New York regulator said.

The amount Barclays will pay to the FCA is £284.4m - the largest financial penalty ever imposed by the FCA.

Georgina Philippou, the FCA's acting director of enforcement and market oversight, said: "This is another example of a firm allowing unacceptable practices to flourish on the trading floor.

"Instead of addressing the obvious risks associated with its business, Barclays allowed a culture to develop which put the firm's interests ahead of those of its clients and which undermined the reputation and integrity of the UK financial system."

A spokesman for the Treasury said: "The Government created the tough new Financial Conduct Authority (FCA) and gave it strong powers to take action wherever its rules are breached.

"The action taken on foreign exchange failings today, and in November last year, shows that the new, tougher regulatory system is working."

Antony Jenkins, chief executive at Barclays, apologised for the bank's role in the scandal.

He said: "The misconduct at the core of these investigations is wholly incompatible with Barclays' purpose and values and we deeply regret that it occurred."

"I share the frustration of shareholders and colleagues that some individuals have once more brought our company and industry into disrepute.

"Dealing with these issues, including taking the appropriate disciplinary action against the individuals involved, is a necessary and important part of our plan to transform Barclays and remains a key priority."