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* Banks asked to conduct independent reviews
* HKMA speaking to other regulators
* 30 traders globally suspended in probe so far (Adds details on suspended trader at Deutsche Bank, backgroundon investigations)
By Rachel Armstrong
April 1 (Reuters) - Regulators in Hong Kong and New Zealandsaid on Tuesday that they are investigating banks' conduct inthe foreign exchange market as part of an investigation tied tothe global probe into FX markets.
The move shows that the regulatory crackdown on the $5.3trillion-a-day-market is escalating and continues to broadenfrom Europe to other parts of the world.
The Hong Kong Monetary Authority (HKMA) said in a statementafter an inquiry from Reuters that it is requiring several banksto conduct independent reviews of their FX divisions and to thensend the HKMA the results.
"The HKMA is investigating into a number of banks in HongKong," an HKMA spokeswoman said in the statement.
A spokesman for New Zealand's Commerce Commission said ithad also started looking into the matter.
"We've got an investigation but that's all we're sayingbecause it's an active investigation," a spokesman for thecommission told Reuters.
Regulators in Hong Kong, the third largest foreign exchangemarket in Asia after Singapore and Tokyo, said in October theywere in contact with foreign regulators about the matter, butthis was the first time they have confirmed actualinvestigations are taking place.
Market watchdogs around the world are looking closely attraders' behaviour on a number of key benchmarks, spanninginterest rates, foreign exchange and commodities markets.
Several banks and brokers have already been fined billionsof dollars for manipulating benchmark interest rates, but theforeign exchange probe could prove to be even more costly giventhe size of the market and scale of investigation.
Authorities are looking at whether traders from differentbanks worked together to influence currency prices and if theytraded ahead of their own customers or failed to accuratelyrepresent to customers how they were determining the prices.
The probes are looking at whether a handful of seniortraders colluded to use knowledge of client orders to movemarkets around the daily "fixings", which set prices forbillions of contracts and investments worldwide.
Singapore's central bank, which oversees dealers in Asia'slargest foreign exchange market, said in October that it was incontact with foreign regulators about the issue but has notprovided any further comment on the matter since then.
ESCALATING PROBE
News of these probes come a day after Swiss and Britishregulators both stepped up their investigations into the matter.
Switzerland's competition commission WEKO said it formallyopened an investigation into several Swiss, British and U.S.banks, including JP Morgan Chase & Co, Barclays PLC and Citigroup Inc.
The UK Financial Conduct Authority (FCA), meanwhile, said itwill assess if banks have cut the risk of traders manipulatingbenchmark rates in the coming year, to see if lessons have beenlearned from the scandal over benchmark rate rigging.
Around 30 traders are known to have been placed on leave,suspended, or fired as a result of the probe.
A source told Reuters on Monday that Kai Lew, a director ofinstitutional foreign exchange sales at Deutsche Bank AG has been placed on leave as part of an internalinvestigation into potential manipulation.
Lew was based in London and responsible for central bank FXbusiness at Deutsche, the world's largest currency trader. Thereis no evidence she has been involved in wrongdoing and she couldnot be reached for comment.
Last week Swiss bank UBS AG, the world's fourthlargest FX bank, suspended up to six currency traders in theUnited States, Zurich and Singapore.
Deutsche Bank and UBS together see around a quarter of the$5.3 trillion that flows through the global market on an averageday, according to the latest Euromoney poll. (Additional reporting by Byron Kaye in Sydney and MichaelFlaherty in Hong Kong; Editing by Ryan Woo & Kim Coghill)
