Class action suit brought against Barclays, BNP Paribas and eight more
Big-name banks including Goldman Sachs, Barclays, UBS and the Royal Bank of Scotland have been accused of conspiring to limit competition by a pension fund in the US.
The class action lawsuit filed yesterday says that the banks, which also include Bank of America Merrill Lynch, JPMorgan Chase, Citigroup, Credit Suisse Group, BNP Paribas and Deutsche Bank, prevented trading of interest rate swaps on electronic exchanges since 2007, Reuters reported.
In the suit filed by The Public School Teachers’ Pension and Retirement fund claims shareholders overpaid for the swaps and the banks have prevented competition from non-banks and “have been able to extract billions of dollars in monopoly rents, year after year, from the class members in this case."
The lawsuit, filed in the US District Court in Manhattan, asserts that the banks used pseudonyms for joint-projects to protect their identities and alleges that the defendants “have jointly threatened, boycotted, coerced and otherwise eliminated any entity or practice that had the potential to bring exchange trading to buy side investors."
Icap and Tradeweb, two broking platforms, are also accused of aiding the violations by making the banks’ decisions and acting as a “forum for collusion,” Reuters also reported.
All but one of the banks accused in the suit own stakes in Tradeweb and hold board positions within the organisation.
Quinn, Emanuel, Urquhart & Sullivan, the plaintiff’s representative, did not return an immediate request for comment from Morning Wire
Goldman Sachs, The Royal Bank of Scotland and Bank of America declined comment. JPMorgan, Citigroup, Credit Suisse, Barclays, BNP, UBS and DB did not return an immediate request for comment.