‘If you ain’t cheat­ing, you ain’t try­ing’ – how forex has changed

Finweek English Edition - - IN THE NEWS - BY AN­DRÉ SPICER

for­eign ex­change mar­ket. There have also been fines levied against banks for ma­nip­u­lat­ing other over-the-counter mar­kets such as LI­BOR, the ISDA­fix and the gold mar­ket.

In ad­di­tion, there have been f ines for other bad be­hav­iour by banks like money laun­der­ing, their role in the sub-prime mort­gage cri­sis, vi­o­lat­ing sanc­tions, ma­nip­u­la­tion of the elec­tric­ity mar­ket, as­sist­ing tax eva­sion, and mis­selling pay­ment pro­tec­tion in­sur­ance. This brings the to­tal amount of f ines which banks have paid since 2008 to over $160bn (R1.9tr). To put this in

City Uni­ver­sity Lon­don con­text, this is more than what the UK gov­ern­ment spent on ed­u­ca­tion last year.

CLEAN­ING UP THEIR ACT

As the cost of mis­be­haviour mounts, banks are un­der in­creas­ing pres­sure to clean up their act. De­spite wide­spread public cyn­i­cism, much has al­ready changed within the bank­ing sec­tor. Banks have beefed up their risk func­tion and in­creased over­sight of traders.

They have also changed the “tone from the top”. Se­nior man­agers of the boom years who pro­moted a hard­driv­ing, risk-tak­ing cul­ture have largely

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