Given the LIBOR story, the Interest Rate Swap manipulation story, the Euro gas price manipulation story, the U.S. energy price manipulation story, and (by now) countless others of the “Everything is Rigged” variety, this screams out for immediate notice. Via Bloomberg:
Traders at some of the world’s biggest banks manipulated benchmark foreign-exchange rates used to set the value of trillions of dollars of investments, according to five dealers with knowledge of the practice . . .
Employees have been front-running client orders and rigging WM/Reuters rates by pushing through trades before and during the 60-second windows when the benchmarks are set, said the current and former traders, who requested anonymity because the practice is controversial. Dealers colluded with counterparts to boost chances of moving the rates, said two of the people, who worked in the industry for a total of more than 20 years.
This time the rates allegedly being rigged are in the foreign-exchange or “FX” markets, meaning that if this story is true, it would almost certainly trump LIBOR for scale/horribleness.
As one friend of mine who works on Wall Street put it, “It’s endless! This is the biggest market in the world.” Bloomberg suggested the story is just the tip of the iceberg…
Full article: http://www.rollingst … -currencies-20130613