From Libor rigging and sanction busting to forex manipulation, a look back at the global banking industry’s offences and penalties • Banks fined £2.6bn for foreign exchange market rigging

Banks pay out £166bn over six years: a history of banking misdeeds and fines

The global banking industry racked up more than £166bn in fines, settlement fees and provisions between 2009 and 2013, the CCP Research Foundation has found. Offences range from Libor rigging and currency market manipulation to breaching sanctions against Iran and Sudan, money laundering for Mexican drug barons and abusive mortgage practices in the US.



The latest penalties have seen five major banks being fined £2bn for rigging the £3.5tn-a-day foreign exchange markets.

Research led by academic Roger McCormick at the CCP Research Foundation shows 10 large banks, including RBS, Barclays, HSBC and Lloyds Banking Group, incurred £166.63bn in fines and provisions between 2009 and 2013.

This year is shaping up to be another big year for bank penalties. Bank of America’s $16bn (£10bn) settlement over allegations of mis-selling mortgage-backed securities took the total for the first eight months of 2014 to more than £31bn, surpassing the total for the whole of 2013. Some of this is already included in the CCP figure as provisions.

Offences related to the US subprime housing crisis

In 2012, five large US banks agreed to pay $25bn to settle charges over abusive methods to foreclose on homeowners. It was the largest US settlement since the tobacco industry agreed to pay more than $200bn compensation to victims of smoking-related diseases in 1998.

More was to come. A smaller, collective settlement of $8.5bn came in January 2013 when 10 big financial institutions settled claims of foreclosure abuses.

There have also been a number of individual settlements: Bank of America’s $16bn settlement in August was the biggest related to the sale of mortgage-backed securities.

Citigroup agreed to pay $7bn to settle a federal investigation into toxic mortgage products the bank sold in the runup to the crisis.

JP Morgan Chase agreed a $13bn settlement after a string of investigations into its risky mortgage deals.

Deutsche Bank settled for $1.9bn over the sale of mortgage-backed securities to US taxpayer-owned Fannie Mae and Freddie Mac.

Morgan Stanley agreed a £1.25bn settlement over the sale of faulty mortgage-backed securities.

UBS reached a $885m settlement over claims it mis-sold mortgage-backed bonds during the housing bubble.

Atlanta-based SunTrust Banks was fined $968m for abusive mortgage practices.

RBS is still awaiting a fine for these practices.

Libor rigging

British and American authorities have fined banks more than $3bn as part of their ongoing investigations into rigging of the benchmark Libor rate. Fines from the Financial Conduct Authority alone for Libor rigging total £532m.

Barclays, which was at the heart of the scandal, was fined £290m by regulators in the US and UK. Lloyds was fined £218m. Swiss bank UBS and brokerage Icap have also paid penalties.

Forex rigging

Five banks were fined a total of £2bn by UK and US regulators – £1.1bn from the UK regulator and the rest from US authorities.

The fines were a record from the FCA: UBS was given the biggest penalty, at £233m followed by £225m for Citibank, JPMorgan at £222m, RBS at £217m, and £216m for HSBC. Barclays has yet to settle. In the US, the regulator fined Citibank and JP Morgan $310m each, $290m each for RBS and UBS, and $275m for HSBC.

Sanction busting

France’s biggest bank, BNP Paribas, reached a $8.97bn settlement with the US authorities in July 2014 for violating sanctions against Iran, Cuba and Sudan.

In 2012 Standard Chartered agreed to pay a $340m fine to the US regulator. It was accused of scheming with Iran to hide billions of pounds’ worth of transactions from the authorities, leaving the financial system susceptible to “terrorists” and “drug kingpins”.

Money laundering

In 2012, HSBC paid $1.9bn to settle US money laundering allegations, including for Mexican drug barons.

Electricity market manipulation

Barclays has been given a £330m penalty from US energy regulators for allegations of rigging electricity markets. It is contesting the fine.

Gold price fixing

In May, Barclays was fined £26m for failing to stop the price of gold being manipulated.

Assisting tax evasion

Credit Suisse in May pleaded guilty to criminal charges that it helped Americans evade taxes, leading to a fine of $2.6bn.

Other penalties

Barclays has faced a series of fines, including a £50m penalty from the FCA for its actions during the bank’s fundraising from Middle Eastern investors in 2008. Barclays is contesting the fine. It was also fined £38m by the FCA in September for breaching rules requiring it to keep its clients’ money separate from its own.

Payment protection insurance (UK)

UK banks have paid out more than £23bn in compensation to customers who were mis-sold payment protection insurance – but no fines have been imposed on them for what is now the UK’s biggest and costliest mis-selling scandal.

•This article has been amended. The article on 12 November mistakenly stated that the global banking industry had been forced to pay £200bn in fines and settlement fees over the past six years. The correct figure is more than £166bn. There may have been some doublecounting of fines that had already been provided for by banks. The compensation payments made by UK banks for PPI are included in the £166bn tally. We originally said they were not.