By Jonathan Stempel
NEW YORK, Feb 18 (Reuters) - Barclays Plc agreed topay $50 million to settle a U.S. lawsuit claiming it rigged itsforeign exchange trading system to reject client orders thatwould be unprofitable for the British bank.
The preliminary, all-cash settlement with investors led byAxiom Investment Advisors LLC was disclosed in papers filed onWednesday night in the U.S. District Court in Manhattan, andrequires a judge's approval.
It comes three months after Barclays agreed to pay $150million and fire a senior electronic trading official to resolvesimilar claims by the New York State Department of FinancialServices.
Barclays denied wrongdoing in agreeing to settle. Mark Lane,a bank spokesman, declined to comment.
Christopher Burke, a lawyer for the plaintiffs, did notimmediately respond on Thursday to requests for comment.
The lawsuit arose from "Last Look," a Barclays feature meantto deter traders from exploiting tiny delays, often just a fewmilliseconds, in the flow of information within the marketplace.
Instead, according to the New York regulator, Barclays usedLast Look as a "general filter" to weed out unprofitable trades,and gave vague or inaccurate responses to clients who asked whytheir trades were not being processed.
Axiom, which is based in Manhattan, said Barclays' activitycaused "significant damages" for its foreign exchangecounterparties, and amounted to breach of contract or fraud.
Barclays revised Last Look in September and October 2014 sothat it would reject trades deemed "sufficiently unprofitable"for both customers and the bank, not just the bank, the New Yorkregulator has said.
The plaintiffs' lawyers in the Axiom case may seek fees ashigh as one-third of the settlement fund, court papers show.
The case is Axiom Investment Advisors LLC v. Barclays BankPlc, U.S. District Court, Southern District of New York, No.15-09323. (Editing by Bernadette Baum)
Barclays (BARC)
