JPMorgan Chase (JPM), Other Banks Mull Banning Currency Traders From Electronic Chat Rooms Following Market Manipulation Probe

JPMorgan Chase & Co. (NYSE:JPM) and other banks are mulling whether to ban traders from electronic chat rooms in the wake of an international foreign exchange investigation, according to a story in the Financial Times.

The chatrooms in question allow users to trade information and gossip about markets, the newspaper said Sunday. Regulators in the U.K., U.S., Switzerland and Hong Kong are investigating whether traders from at least 10 large banks conspired to influence foreign exchange benchmarks.

Groups of senior traders from rival banks used these chat rooms to share information about client orders so they could trade ahead of them, a practice known as front running.

Some of these chatrooms can be accessed by Bloomberg terminals, and banks reviewing their employees’ access believe they draw scrutiny from officials regardless of whether any actual wrongdoing takes place.