On Tuesday the US police arrested a top HSBC execurive for fraud.
On Tuesday night the company’s global head of foreign exchange trading was charged. Later he will appear in court. His former colleague, Stuart Scott is also accused.
The US government charged the both traders after they have used inside information to profit from $3.5bn currency deal.
There are no comments from HSBC.
The traders are accused by the US Department of Justice of “front-running”.
They misused confidential information which was provided by their clients. These clients were going to convert $3.5bn into British pounds.
The two executives wanted to make much money and bought sterling themselves. Then they handled the order. This large transaction was made to push the currency’s value.
To maximise the effect of the purchase on the value of the British currency they timed this purchase. It is supposed they could generate significant incomes for the bank. Their actions were concealed from the clients. They are accused of using their positions for enrichment.
In their emails and conversations in Bloomberg chats before the clients squealed the two men about the increase of the dollar according in pound exchange according to US prosecutors.
The profit from the currency trade was $8m in roughly.