London court gives green light to £2.7bn foreign exchange claim against six major banks
The Court of Appeal ruled today that a £2.7bn class action claim relating to foreign exchange manipulation can proceed on an opt-out basis.
The claim, brought by FX Claim UK, represents tens of thousands of participants in the foreign exchange market who suffered damages from the anticompetitive behaviour of six of the largest banks in the world.
The claim is directed against Barclays, Citibank, The Royal Bank of Scotland/Natwest, JP Morgan, UBS and MUFG Bank.
The banks participated in unlawful foreign exchange trading cartels between 2007 and 2013. They later admitted their misconduct to the European Commission, which fined them more than €1.1bn.
FX Claim UK, the collective action brought by former competition investigator Philip Evans, is seeking damages worth around £2.7bn for the businesses that suffered as a result of the banks’ illegal behaviour.
Today’s ruling means that class members are automatically included in the claim unless they opt-out. An earlier judgement from the Competition Appeal Tribunal (CAT) ruled that claims should be certified, but not on an opt-out basis. In effect, this would have shut down the case.
The Court of Appeal argued the CAT had not explained why opt-in proceedings were preferable and noted more information had come to light since the CAT’s ruling
Reacting to the decision, Evans commented: “This ruling acknowledges the practical difficulties of opt-in legal proceedings and confirms the access to justice principle which underpins the collective action regime.
“The opt-out approach is crucial to ensure that claims may be pursued on behalf of all affected individuals and businesses,” he continued.
Hausfeld partner and global co-chair, Anthony Maton, said: “A judgement of this nature was required for all those UK businesses – big and small – who have suffered loss as a result of the manipulation of the FX markets to achieve restitution.
“The path to restitution can now begin and I ask the banks involved to come forward and agree fair and adequate compensation for those affected by their illegal behaviour,” he said.
UBS, Citi and JP Morgan declined to comment. Barclays, Natwest and MUFG did not immediately respond to requests for comment.