RBS reaches US settlement over Forex scandal
The Royal Bank of Scotland will pay penalties of $395 million to the United States Department of Justice and $274 million to the US Federal Reserve in the aftermath of investigations into the foreign exchange scandal.
RBS has admitted its role in a conspiracy to manipulate the price of US dollars and euros exchanged in the FX spot market.
The charged conspiracy, involving a series of banks, continued from as early as December 2007 to at least January 2013. RBS is charged with participating in the conspiracy, through one of its euro/US dollar currency traders, from as early as December 2007 until at least April 2010.
RBS entered a guilty plea pursuant to a plea agreement with the Department of Justice, subject to approval of the federal court in Connecticut that is presiding over the matter.
RBS and RBS Securities Inc. have also entered into a cease and desist order with the Federal Reserve relating to defined FX activities, and undertaken to submit enhanced plans, acceptable to the Federal Reserve, to comply with applicable US laws and regulations.
RBS remains in discussions with governmental and regulatory authorities in other jurisdictions in relation to conduct within its FX business.
Philip Hampton, RBS chairman (pictured), said: “The RBS Board fully accepts the conclusions of today’s resolutions.
“We strongly condemn the actions of those responsible and regret the control failings that allowed such misconduct to take place.
“This episode has exposed serious shortcomings at both individual and collective levels from which we continue to learn.
“As part of this effort we are committed to implementing further improvements to systems and controls.
“We are continuing thorough investigations into the conduct of employees in this part of the business.
“As a result, we have dismissed three people and suspended two more pending further investigation. This work is on-going and will take into account the findings contained in these settlements.”
Ross McEwan, RBS chief executive, added: “The serious misconduct that lies at the heart of today’s announcements has no place in the bank that I am building.
“Pleading guilty for such wrongdoing is another stark reminder of how badly this bank lost its way and how important it is for us to regain trust.”