The NY Department of Financial Services (NYDFS), has handed Barclays an additional $150m penalty and ordered the bank to terminate an employee for what it called: ‘Automated, Electronic Foreign Exchange Trading Misconduct’
According to the NYDFS:
Barclays Used “Last Look” System to Automatically Reject Client Orders that Would Be Unprofitable Because of Subsequent Price Swings during Milliseconds-long Latency (“Hold”) Periods.
The additional fine brings the overall Barclays Foreign Exchange NYDFS Penalty to $635 Million.
That clearly explains why last month Barclays released ‘last look’ guidelines on their BARX website. In previous posts, I have argued that the practice of last look, in effect provides banks with ‘an option on the price’ that gives them an asymmetric advantage over their clients. The press release actually makes fascinating reading, and for that reason I have reproduced most of it below (the bold underline is from the original press release, and not my emphasis).
According to Anthony J. Albanese, Acting Superintendent of Financial Services” at NYDFS, in addition to the fines, Barclays would also: Continue reading
Filed under: FX, last look, Paul Blank, Regulation | Leave a comment »
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