Two courts in London are reviewing two different versions of a £1billion ($1.4 billion) class-action lawsuit alleging foreign exchange price manipulation by at least five large banks that cost customers big bucks, according to a Financial Times report.
The class-action lawsuits allege that banks unfairly paid out foreign exchanges for at least six years between 2007 and 2013, the report says. In another court action, ECU Group accuses HSBC of fraud and misconduct in a trial in London’s High Court that started last month.
The class-action lawsuits represent the interests of pension funds and asset managers against Barclays, Citibank, Royal Bank of Scotland, J.P. Morgan and UBS, focusing primarily on groups that have been nicknamed “three-way banana split” and “the Essex express.”
Lawyers for the banks are urging the Competition Appeal Tribunal to block the class-action claims in favor of an opt-in lawsuit. A decision on whether the class-action lawsuit will proceed and who would serve as the class representative could come this week.
The tribunal faces the decision of whether to approve the class-action claim led by former UK Competition and Markets Authority inquiry chairman Phillip Evans that’s backed by law firm Hausfeld — or the one fronted by former Pensions Regulator chairman Michael O’Higgins, who has law firm Scott + Scott in his corner.
The latter law firm earned a $2.3 billion settlement in the U.S. against 15 banks as part of a class-action foreign exchange lawsuit. Some of the largest claimants opted out of that settlement, though, fearing they wouldn’t receive as much money as they had hoped.
The London tribunal claim is one of the first cases under the Consumer Rights Act of 2015, which allows Londoners to pursue class-action lawsuits if there have been suspected breaches of competition law. One person can bring a lawsuit representing an entire class of people, except those who have opted out.