Traders' online chats cost banks £100m in competition penalties

A group of five banks were caught out when their employees' private internet exchanges were considered by authorities to have breached the Competition Act 1998. Firms face legal risks in this area that need to be identified, monitored and managed, writes Denis O'Connor.

Denis O'Connor is a fellow of both the Institute of Chartered Accountants in England & Wales and the Chartered Institute of Securities and Investment. He was a member of the British Bankers' Association Money Laundering Committee from 2003-10 and a member of the Joint Money Laundering Steering Group's board and editorial panel between 2010 and 2016. He has been a frequent speaker at industry conferences on financial crime issues, both in the United Kingdom and abroad.

The Competition and Markets Authority (CMA) has recently fined four banks over £100 million because their traders took part in confidential one-to-one Bloomberg chatrooms where they discussed sensitive information about the buying and selling of United Kingdom government bonds (gilts) on specific dates. [1] Citi, HSBC, Morgan Stanley and the Royal Bank of Canada (RBC) all agreed to pay substantial fines to the CMA. Deutsche Bank did not receive a fine as it self-reported its illegal conduct and provided specific and relevant information to assist the CMA in its investigation into the banks' conduct.