New York regulators have slapped Swiss bank Credit Suisse with a $135m (£103m) fine after finding it engaged in misconduct in its foreign exchange trading business.
Credit Suisse shared information with other banks which may have allowed coordinated trading and “manipulation of exchange rates”, the Department of Financial Services (DFS) in New York said in an order announcing the fine.
The regulator said: “From at least 2008 to 2015, Credit Suisse consistently engaged in improper, unsafe, and unsound conduct, in violation of New York laws and regulations, by failing to implement effective controls over its FX business.”
The bank used an algorithm to engage in front-running – using non-public knowledge of an impending transaction – on limit and stop-loss orders from its customers.
The bank’s foreign exchange trading platform, eFX, also rejected some trades which would have caused it losses on the false pretence of a systems error, the regulator said.
Credit Suisse’s actions directly impacted customers by reducing competition, the regulator said. Traders in online chat rooms also colluded with other banks, seeking to “diminish competition” and “reap higher profits from the execution of FX trades at customers’ expense”, the DFS order said.
Credit Suisse is one of the top 12 global systemically important banks, according to the Bank for International Settlements, with assets of $792bn globally and more than 46,000 employees.
The bank will take the charge in its fourth-quarter financial results, to be released in February.
In a statement the bank said: “Credit Suisse does not admit to any findings of fact and the resolution does not involve any fraud-based violations.
“Credit Suisse is pleased to have reached a settlement with the DFS that allows the bank to put this matter behind it.”