Credit Suisse is going to face a class-action lawsuit brought by investors in the United States for foreign exchange (forex) rigging as a New York court judge refused the bank’s appeal for the dismissal of the case on Tuesday.
Several institutional investors accused that Credit Suisse traders have shared sensitive and non-public price information with counterparts in other banks, thus effectively rigging the currency prices in a $6.6 trillion-a-day forex market.
These banks operated as cartels in fixing the forex price and even shared information in chat rooms with names like Yen Cartel.
Credit Suisse is the last bank that remained from the alleged cartel to face the investors’ allegations in the litigation that started in 2013 as 15 other banks successfully settled charges by paying $2.31 billion.
In addition, some of the banks faced regulatory probes and eventually fines of more than $10 billion. Many traders involved in the cartel were also convicted, whereas others are facing indictments.
The Court Will Decide the Fate
Credit Suisse approached the court, claiming that it was not a part of any global conspiracy that attempted to rig the spreads of forex. However, the court said that it is premature to accept such claims of the bank.
Further, the New York judge rejected the push of the investors to hold the bank liable. “Questions remain about the scope of the shared illegal goal and extent of the conspirators’ mutual dependence and assistance,” Judge Lorna Schofield said.
Meanwhile, the bank remains strong in its position and is confident with its defence in the case.
“We continue to believe that Credit Suisse has strong legal and factual defences, and we look forward to establishing those at trial,” Credit Suisse stated.
Furthermore, the Suisse bank is about the defend itself in a Swiss court as the country’s prosecutors are seeking around $45 million in penalties from it for serious failure in anti-money laundering regulations, Finance Magnates reported earlier.
