U.S. judge orders 15 banks to face big investors' currency rigging lawsuit

By Jonathan Stempel

NEW YORK, May 28 (Reuters) - A U.S. judge on Thursday said
institutional investors, including BlackRock Inc and
Allianz SE's Pacific Investment Management Co, can
pursue much of their lawsuit accusing 15 major banks of rigging
prices in the $6.6 trillion-a-day foreign exchange market.

U.S. District Judge Lorna Schofield in Manhattan said the
nearly 1,300 plaintiffs, including many mutual funds and
exchange-traded funds, plausibly alleged that the banks
conspired to rig currency benchmarks from 2003 to 2013 and
profit at their expense.

"This is an injury of the type the antitrust laws were
intended to prevent," Schofield wrote in a 40-page decision.

The banks, which sometimes controlled more than 90% of the
market, included Bank of America, Barclays, BNP Paribas,
Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC,
JPMorgan Chase, Morgan Stanley, Royal Bank of Canada, Royal Bank
of Scotland, Societe Generale, Standard Chartered and UBS or
various affiliates.

In their complaint, the plaintiffs accused the banks of
improperly sharing confidential orders and trading positions,
and using chat rooms with such names as "The Cartel," "The
Mafia" and "The Bandits' Club."

Banks were also accused of using deceptive trading tactics
such as "front running," "banging the close" and "taking out the
filth."

The banks countered that the plaintiffs pointed to no
transactions where the alleged manipulation caused losses.

Schofield dismissed portions of some the claims, and
dismissed some Allianz plaintiffs from the case.

Lawyers for the plaintiffs did not immediately respond to
requests for comment.

The litigation began in November 2018, after the plaintiffs
"opted out" of similar nationwide litigation that had resulted
in $2.31 billion of settlements with most of the banks.

Those settlements followed regulatory probes worldwide that
led to more than $10 billion of fines for several banks, and the
convictions or indictments of some traders.

Investors typically opt out of litigation when they hope to
recover more by suing on their own.

The case is Allianz Global Investors GMBH et al v Bank of
America Corp et al, U.S. District Court, Southern District of
New York, No. 18-10364.
(Reporting by Jonathan Stempel in New York; Editing by Aurora
Ellis)