Big banks may block traders from online chat rooms - WSJ

Reuters

Nov 10 (Reuters) - Big banks are considering disablingonline chat rooms that link traders across many financialinstitutions over concerns of mounting scrutiny from regulators,the Wall Street Journal reported, citing people familiar withthe discussions.

JPMorgan Chase, Credit Suisse Group andCitigroup Inc among others, are reviewing chat-room useover concerns that some of those forums are seen by regulatorsas potential venues for collusion and market manipulation.

The probes are focused on chat rooms with names such as "TheCartel," people told the Journal. ()

Chat communications have featured prominently in a five-yearprobe into manipulation of a key interest rate known as theLondon interbank offered rate, or Libor, which has cost banksbillions of dollars in settlements, with more fines expected.

Regulators and investors are concerned about the integrityof financial benchmarks after the investigation into the riggingof Libor rates.

The Swiss Financial Market Supervisory Authority, FINMA,earlier said that it was "conducting investigations into severalSwiss financial institutions in connection with possiblemanipulation of foreign exchange markets."

None of the banks could immediately be reached for commentby Reuters outside of regular U.S. business hours.

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