HSBC could face further forex lawsuit after High Court orders it to turn over trading records

HSBC

HSBC has been ordered by the UK high court to disclose documents relating to alleged manipulation of foreign exchange markets by its traders in London and New York over a decade ago.

UK-based currency investor ECU Group won the court order as it seeks to establish whether HSBC manipulated the market to profit ahead of executing three trades for ECU worth more than $100m (£75m) a piece in 2006.

HSBC now has to disclose all correspondence and records related to the alleged suspect trades, which could pave the way for a full lawsuit.

Europe’s biggest lender has already been embroiled in scandals related to forex rigging and was one of several bank fined $4.3bn three years ago by US regulators for systematic rigging of the market between 2008 and 2013.

ECU’s allegations relate to an earlier period and could embroil London traders for the first time. ECU claims HSBC traders on both sides of the Atlantic engaged in “front-running” for the bank’s own profit ahead of executing ECU’s three so-called ‘stop-loss’ orders.

Michael Petley, chief executive at ECU, commented: “HSBC has put every conceivable hurdle in our way in our quest for this disclosure, making the process as difficult, protracted and expensive as possible.

“We therefore welcome today’s ruling and look forward to finding the truth behind the handling of our FX orders, so that we can determine whether we have been a victim of fraudulent misconduct by HSBC."

HSBC declined to comment.