Indian trader convicted for bid-rigging in forex market

Indian trader convicted for bid-rigging in forex market

Representative Image (Photo by Reuters)

An Indian-origin former currency trader was convicted here for his participation in an antitrust conspiracy to manipulate prices for emerging market currencies in the global foreign currency exchange market (FX), the Justice Department announced.

Akshay Aiyer, a former executive director at a major multinational bank, was convicted by a jury following a three-week trial in the US District Court for the Southern District of New York of conspiring to fix prices and rig bids in Central and Eastern European, Middle Eastern and African (CEEMEA) currencies, which were generally traded against the USD and the euro, from October 2010 through January 2013.

Assistant Attorney General Makan Delrahim of the Department of Justice's Antitrust Division said the conviction serves as a reminder of America’s commitment to hold individuals responsible for their involvement in complex financial schemes which violate the integrity of the global financial markets.

According to evidence presented at trial, Aiyer engaged in near-daily communications with his co-conspirators by phone, text and through an exclusive electronic chat room to coordinate their trades of the CEEMEA currencies in the FX spot market.

Aiyer and his co-conspirators manipulated exchange rates by agreeing to withhold bids or offers to avoid moving the exchange rate in a direction adverse to open positions held by co-conspirators and by coordinating their trading to manipulate the rates in an effort to increase their profits.

By agreeing not to buy or sell at certain times, the traders protected each other's trading positions by withholding supply of or demand for currency and suppressing competition in the FX spot market for emerging market currencies.

Prosecutors said they also heard evidence that Aiyer and his co-conspirators took steps to conceal their actions by, among other steps, using code names, communicating on personal cell phones during work hours and meeting in person to discuss particular customers and trading strategies.

The Antitrust Division has charged five companies and six individuals in its investigation of collusion in the FX spot market.

In May 2015, four major banks-Citicorp, JPMorgan Chase, Barclays and The Royal Bank of Scotland – pleaded guilty and agreed to pay collectively more than USD 2.5 billion in criminal fines for their participation in an antitrust conspiracy in the euro-USD FX spot market.