Two of the world's largest banks suspended, or put on leave, traders in London and New York yesterday as part of an investigation into alleged manipulation of the trillion-dollar currency market.
HSBC said it had suspended two workers in its London headquarters, while Citigroup confirmed that two employees had been put "on leave", including one based in the US. Bloomberg named the HSBC traders as Edward Pinto and Serge Sarramegna and the Citigroup workers as Anthony John and Andrew Amantia, although neither bank would confirm this.
Benchmark foreign exchange rates are used to price $5.3trn (£3.3trn) a day worth of investments and deals across the global financial markets. Citigroup, Deutsche Bank RBS, JPMorgan and Standard Chartered have already fired, suspended, or put a total of 17 currency traders on leave for alleged rigging, and more penalties are expected over the coming months.
The news is the latest example of global regulators rounding on the financial services industry for a growing list of misdemeanours, which also include mis-selling and manipulation of inter-bank lending rates.
Individuals have also been penalised and yesterday it emerged that Julian Rifat, a former trader at hedge fund Moore Capital, faces eight insider-dealing charges over trades in companies including Barclays and Volkswagen. He is expected to appear in court later this month.
Meanwhile, the Financial Conduct Authority, also appointed consultancy Promontory Financial and accountants Mazars to report on Royal Bank of Scotland's treatment of business borrowers in the wake of Lawrence Tomlinson's report, which accused RBS of deliberately killing off businesses referred to its Global Restructuring Group.
Over in the US, Morgan Stanley became the latest US bank to have its financials wrecked by legal costs, which almost wiped out its earnings for the final quarter of the year.
But despite a $1.2bn hit it still increased the amount set aside to pay its bankers by $400m to $4bn. That left a profit of just $181m compared with $594m in the final three months of 2012 on revenues of $7.8bn, up from $7bn.
The bank's wealth management division performed strongly, but that was offset by weak revenues from fixed-income trading, something that has hit earnings across Wall Street's big banks.
But legal expenses have also been a feature, knocking the stuffing out of numbers at JPMorgan and Citigroup.
Forex by numbers
£3.3 Trillions of deals using Forex rates.
17 Traders fired, suspended or on leave.