The Serious Fraud Office, which is the UK’s most senior fraud team, is preparing to investigate the alleged fixing of the Forex market. It is believed that the SFO is currently gathering data, and could be ready to prepare a full investigation by the end of next month.
The SFO certainly won’t be the first group to investigate the claims, with the antitrust and fraud teams from the US Department of Justice, and the Financial Conduct Authority in the UK already having launched probes into the multi-trillion dollar industry and alleged price rigging. Some banks could be set for a second substantial fine, just shortly after several billion dollars of fines have been paid for the Libor scandal that has included a number of UK banks and traders so far, and is still underway with its own threat of criminal legal action against the banks.
The SFO has confirmed that they are indeed collecting evidence, but have yet to commit to whether or not they will be launching a full investigation. They have said that once they have collected data, if they decide to launch an investigation then an announcement will be made in the usual way. The UK is likely to be heavily involved in this particular fixing scandal, because London accounts for approximately 40% of the whole market.
It is highly likely, and has been confirmed by a number of insiders, that the SFO would require additional funding in order to be table to take on what would prove to be a massively expensive investigation, especially with it coming so soon after the Libor investigation. It is believed that any announcement of an investigation is being held off until the government has agreed to the additional funding required.
It was the Libor investigation that led to questions being raised over whether similar actions could have been taken within other markets including the Forex market. More than 30 traders have been suspended, placed on leave, or sacked following the start of investigations, while a further 12 former traders have been prosecuted as part of the Libor scandal.