Inside The Cartel: The worst comments made in trading chat rooms.
Some traders can cost banks dearly, very dearly. Fines totally $5.6 billion spread among six banks for rigging currency markets show just how costly the actions of staff can hit big banks.
When you look back at some of the transcripts from the chat rooms used to fix the market, it’s a wonder they ever thought they’d get away with it.
US attorney general Loretta Lynch called it “brazenly illegal behaviour” that was carried out on a daily basis.
“They acted as partners - rather than competitors - in an effort to push the exchange rate in directions favorable to their banks but detrimental to many others," she said.
At the epicentre of the deceit was The Cartel, a chat room launched in 2007 that promoted rigging by members, although it was just one of many in existence.
So in the interests of highlighting just how much banks should have done more to ban traders from using chat rooms, here are some priceless gems.
Forex traders working in the dollar-Brazilian real market agreed to boycott local brokers. One wrote “everybody is in agreement in not accepting a local player as a broker?”, to which the response was “yes, the less competition the better”.
In another incident, one trader explained how “markup is making sure you make the right decision on price ... which is whats the worst price i can put on this where the customers decision to trade with me or give me future business doesn’t change”.
The same trader wrote the now infamous epithet “if you aint cheating, you aint trying”.
It wasn’t all greed for greed’s sake, though. Customers had to be retained.
One trader wrote: “Hard mark up is key ... but i was taught early ... u dont have clients ... u dont make money ... so dont be stupid.”
In another incident, when discussing whether someone outside the group could join the chatroom, one trader pointed out that they “dont want other numpty' s in mkt to know”.
Those traders cost their banks a lot of money in the long run and it's an area of risk/compliance that still needs to be monitored to avoid future problems.