21 July, AtoZForex – The investigation into currency rigging at multiple global banks is going on for almost three years, but no result was seen until this week. Tuesday evening Mark Johnson, HSBC Head of Forex arrested at JFK airport in New York and charged with foreign exchange market rigging.
Why was the HSBC Head of Forex arrested?
HSBC is one of the largest banking and financial services organizations in the world. Currently, it serves more than 47 million customers. Two years ago HSBC paid $618 million in fine after being charged with rigging the foreign exchange market. Mark Jonson is an HSBC global head of foreign exchange cash trading in London. He was arrested this Tuesday morning at NY John F. Kennedy airport while trying to leave the United States.
According to the federal prosecutors, Johnson acted collaboratively with ex-HSBC European head of currency trading, Stuart Scott. They are charged with front-running orders just before executing a huge trade for a customer. Allegedly, the duo made $3 million in profit. The deal is said to be involving an oil and gas company, which wanted to exchange the USD with GBP.
What is next?
According to the reports, Johnson is the first person to be charged in the Justice Department’s 3-year investigation into Forex rigging at global banks. He had to appear before the Federal Court in Brooklyn yesterday morning. He appeared before Judge Lois Bloom and he was released on $1 million bail.
Now, with HSBC Head of Forex arrested, a number of other senior executives at global banks could be involved in the investigation and charged as well. In case the front-running is considered a criminal offence, the US department for Justice will have to face a difficult task of identifying all of the companies and individuals who have been engaging in Forex rigging for years.
See also: Forex Market discussion: Europe in Crisis?
Think we missed something? Let us know in the comments section.