An independent inquiry into what the Bank of England knew of alleged currency market collusion will quiz senior traders about what guidance they received from the UK’s central bank as far back as 2012.
Anthony Grabiner, a barrister appointed by the bank’s oversight committee in March, has set up a series of interviews with the currency dealers who attended a critical meeting with BoE officials two years ago — one year before a worldwide investigation into alleged collusion and manipulation was launched.
Accounts of the April 2012 meeting of chief dealers — a subgroup of the BoE’s foreign exchange joint standing committee — are key to traders’ claims that central bank officials turned a blind eye to, or even condoned, activity that regulators are now poring over.
The interviews take Grabiner’s review outside the walls of the central bank and into what it knew of now suspect market behaviour and if it effectively gave a green light for these trading practices to continue.
While the BoE has no direct regulatory role over the currency market, it acts as an informal monitor for financial stability purposes.
The crux of the worldwide probe is whether a small group of top dealers shared client order information via electronic chatrooms to corner the market and give them better control of pricing. The extent of this activity and degree to which it amounted to collusion or manipulation has yet to be established by the year-old investigation.
Grabiner will conduct the interviews throughout this month and beyond.