Banks Settle $86.4 Million Bond Rigging Case in Manhattan

Six major global banks have agreed to pay $86.4 million to settle allegations of colluding to manipulate prices of Mexican government bonds over a period exceeding a decade. The preliminary settlement was filed in Manhattan federal court, concluding an antitrust lawsuit that has been ongoing for more than eight years.

The banks involved in the settlement include Bank of America, Banco Santander, BBVA, Citigroup, Deutsche Bank, and HSBC. While they have settled the claims, none of the banks admitted to any wrongdoing. The lawsuit, initiated by US pension funds and other investors, accused the banks' Mexican subsidiaries of price-fixing and coordinating bond allocations from January 1, 2006, to April 19, 2017.

Evidence presented in the case included chatroom transcripts from internal communications among traders, which allegedly showed coordinated efforts to suppress prices when purchasing Mexican government bonds while inflating them during sales. This settlement follows previous payouts in the case, including a $15 million settlement from JPMorgan Chase and $5.7 million from Barclays in 2020, bringing the total recovery to $107.1 million.

The plaintiffs' legal team may request up to one-third of the settlement amount for attorney fees, pending court approval. The remaining funds will be distributed among the affected investors, primarily US pension funds. This case is part of a larger trend of antitrust litigation in Manhattan federal court, addressing alleged collusion by banks in various financial markets.

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Source: KLEA News