Investors to pause forex litigation amid U.S. government probe

By Nate Raymond

NEW YORK, March 10 (Reuters) - Lawyers pursuing an antitrustlawsuit by investors accusing 12 major banks of rigging pricesin the $5.3 trillion-a-day foreign exchange market agreed to putmost of the litigation on hold amid a related criminal probe bythe U.S. Department of Justice.

In a letter filed in Manhattan federal court late on Monday,the Justice Department said the plaintiffs agreed to a six-monthstay, with a few exceptions, on depositions and documentexchanges.

The stay comes as investigations, including by a federalgrand jury, continue into whether banks rigged the currencymarkets for more than a year.

In November, U.K. and U.S. regulators fined six banks atotal of $4.3 billion after a global investigation into theirfailure to stop traders from trying to manipulate the foreignexchange market.

Banks including JPMorgan Chase & Co, Royal Bank ofScotland Group Plc, Citigroup Inc and UBS AG have meanwhile disclosed related investigations by the JusticeDepartment.

JPMorgan, RBS and UBS have said they are in discussions toresolve the investigations. Representatives for the banks eitherdeclined comment or did not respond to requests for comment onTuesday.

Peter Carr, a Justice Department spokesman, called theinvestigation active and ongoing. He declined further comment.

In the private litigation, JPMorgan in January became thefirst to reach a deal, agreeing to pay $99.5million.

Investors accused the banks of impeding competition byconspiring to manipulate the WM/Reuters Closing Spot Rates,known as the Fix, in chat rooms, instant messages and emails.

The other bank defendants include Bank of AmericaCorp, Barclays Plc, BNP Paribas SA,Citigroup, Credit Suisse Group AG, Deutsche BankAG, Goldman Sachs Group Inc, HSBC HoldingsPlc, Morgan Stanley, RBS and UBS.

In January, U.S. District Judge Lorna Schofield rejected abid by the banks to dismiss the case because of a lack ofevidence that they had colluded to manipulate the Fix.

After that ruling, the Justice Department wrote the judge inFebruary seeking a stay of the exchange of evidence for sixmonths. The plaintiffs responded they understood prosecutors'concerns, but proposed a more limited stay.

As part of the agreement disclosed on Tuesday, plaintiffswould among other things still be able to obtain transactiondata and some limited other information from the banks' lawyers.

A hearing is scheduled for March 26. Lawyers for theplaintiffs did not respond to requests for comment.

The case is In re: Foreign Exchange Benchmark RatesAntitrust Litigation, U.S. District Court, Southern District ofNew York, No. 13-07789. (Reporting by Nate Raymond in New York. Editing by AndreGrenon)