ANZ, Westpac admit breaches in forex trading

ANZ and Westpac have followed rivals and yielded to the corporate regulator’s investigation into banks’ foreign exchange businesses, agreeing to oversight and changes after traders shared confidential client information and traded to benefit themselves.

Similarly to the CBA and NAB transgressions, ASIC said Westpac traders disclosed confidential details of pending client orders to external parties in the spot foreign exchange market, including by using “code names”.

“Both banks failed to ensure that their systems and controls were adequate to address risks ­relating to instances of inappropriate conduct identified by ASIC,” the watchdog said.

In the massive ­global foreign exchange market where daily turnover averages $US5.3 trillion ($7 trillion), banks’ spot businesses facilitate for clients — such as asset managers and other institutions — buying and selling currencies via contracts at agreed exchange rates.

The action follows similar wrongdoing by the Commonwealth Bank and National Australia Bank during the same period across their so-called wholesale spot foreign exchange businesses, which was aired by ASIC in ­December and also resulted in undertakings.

Read the full article in The Australian.

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