BoE suspends staffer over forex market rigging review
06 Mar 2014
A staff of the Bank of England has been suspended after the lender stepped up the pace of its review into whether it was aware of or even allowed alleged rigging of the multi-trillion-dollar-a-day foreign exchange market.
The suspension of one of the bank's own staff could lead to suspicions over the functioning of foreign exchange market review process at the UK's apex bank.
Martin Wheatley, chief executive of the Financial Conduct Authority, had voiced concerns about the rigging scandal being potentially as grave as the Libor rigging.
Regulators had placed at least 15 banks worldwide under investigation over forex rigging claims.
Under governor Mark Carney the bank started an internal review into allegations of its officials condoning or being in the know of manipulation in the foreign exchange market or the ''sharing of confidential client information'' in December.
Traders had alleged the bank had been told almost two years ago that they regularly exchanged information on the size of their clients' orders before fixing exchange rates.
According to the traders, they had been told by bank officials that there was nothing inappropriate in doing this.
Bank of England officials re reported to have been aware of concerns regarding manipulation of foreign-exchange markets as early as July 2006, over seven years before formal probes had been opened by regulators into alleged rate-rigging.
Meanwhile, the BOE yesterday released minutes of central bank meetings with traders from some of the world's biggest banks that reflected concerns over the manipulation of currency benchmarks.
The notes raise questions about whether it was possible for the central bank to do anything more to stop practices at the heart of investigations by authorities around the world of allegations traders colluded to rig rates.
The minutes also showed that the issues were known to central bank officials long ahead of a 2012 meeting, which was reported by Bloomberg News last month and drew criticism by lawmakers.
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