(Reuters) – Hong Kong’s de facto central bank said on Tuesday that it is investigating a number of banks as part of the global probe into alleged manipulation of foreign exchange markets, as investigations into the $5.3 trillion-a-day-market escalate.
The Hong Kong Monetary Authority (HKMA) said in a statement to Reuters that it is requiring several banks to conduct independent reviews of their foreign exchange operations and send it the results.
“The reviews are in progress,” an HKMA spokeswoman said in the statement. “The HKMA is also liaising with relevant overseas bank supervisors on the matter.”
Several banks and brokers have already been fined billions of dollars for manipulating benchmark interest rates, but the foreign exchange probe could prove to be even more costly.
Authorities are looking at whether traders from different banks worked together to influence currency prices and if they traded ahead of their own customers or failed to accurately represent to customers how they were determining the prices.
HKMA first said in October that it was in contact with foreign regulators about the matter, but this is the first time it has confirmed actual investigations are taking place.
The statement comes a day after Swiss and British regulators both stepped up their investigations into the matter.
The UK Financial Conduct Authority (FCA), meanwhile, said it will assess if banks have cut the risk of traders manipulating benchmark rates in the coming year, to see if lessons have been learned from the scandal over benchmark rate rigging.
Around 30 traders are known to have been placed on leave, suspended, or fired as a result of the probe. (Reporting by Rachel Armstrong in SINGAPORE; Editing by Ryan Woo & Kim Coghill)