Foreign exchange probes reportedly expand

The global investigation into evidence of foreign exchange market manipulation has reportedly expanded to focus on at least 15 major banks.

Great Britain's Financial Conduct Authority has requested information from those banks, the Financial Times reported Wednesday, citing two unidentified people close to the situation.

The multinational investigations are examining Euro-U.S. dollar trading, one of the largest foreign exchange sectors, and several banks have provided information to investigators in hope of gaining leniency, the newspaper also reported.

FCA spokesman Chris Hamilton declined to comment on the multinational probe, which at least in part is examining whether traders at major banks rigged foreign exchange rates by colluding on transactions and trading ahead of clients. In June, the agency said it was "aware of these allegations and has been speaking to the relevant parties."

The development came one day after Joaquin Almunia, the European Commission's vice president and top official responsible for competition policy, raised the foreign exchange probe and other investigations in a speech prepared for a European conference held by Swiss banking giant UBS.

"As we observe the first signs of recovery after a long period of recession, we need a different kind of finance to sustain it: safe, more transparent and focused on financing the real economy," according to Almunia's prepared text.

JPMorgan Chase, Citigroup, Britain-based Barclays, UBS, Goldman Sachs, German banking giant Deutsche Bank and Royal Bank of Scotland are among the world's major banks that recently confirmed their foreign exchange trading was under investigation.

U.S. investigators examining foreign exchange trading include the Commodity Futures Trading Commission and the Department of Justice's criminal and antitrust divisions. Authorities in Switzerland and Hong Kong are also investigating.

The probes represent the latest global examination of financial benchmarks that affect tri! llions of dollars in personal and business transactions. To date, five major banks have collectively paid more than $3 billion in fines to settle allegations that their traders rigged the London Interbank Offered Rate. Widely known as Libor, the benchmark is used to set rates on mortgages, credit cards, many types of loans and some financial derivatives.

In his Tuesday speech, Almunia also cited an investigation of suspected collusion in reporting oil prices and an examination of the market for credit derivative contracts.