Labaton Sucharow partner Gregory Asciolla recently spoke with FX Week about a recent class action against 12 global banks alleging the foreign exchange benchmark was manipulated more than 25 percent of the time for more than 10 years.
According to Gregory, “In the FX complaint we filed, it was alleged that for six currency pairs analysed, there was manipulation of the 4 pm benchmark on the last trading day of the month between 26% and 34% of the time, depending on the currency pair.”
Similar to a natural gas case he previously worked on, Gregory said, “The lawsuit was based around an effort by a number of energy companies to manipulate the benchmark used to price natural gas futures contracts by submitting false bids.”
“I think these benchmarking cases can be looked at in two ways,” he continued, “One is the Libor-type case, where there is general suppression or inflation of a benchmark consistently over a long period of time. The other is an FX-type case, where the manipulation is more ad hoc.”