By Sonya Rabbitte, 16 May 2002 15:55
NEWS A global banking exchange founded by financial stalwarts Goldman Sachs, JP Morgan and UBS Warburg, is being investigated by the European Commission and the US Department of Justice for evidence of anti-competitive behaviour. More than 50 of the world's leading financial institutions are members of FXall which provides an electronic marketplace for international foreign currency trading. Members include UK banks HSBC and Lloyds TSB. Reports in the Wall Street Journal suggest FXall has come under scrutiny following the recent closure of rival exchange Atriax. The EU commissioner Mario Monti yesterday met with the US assistant Attorney General Charles James. Referring to the Wall Street Journal report, Monti refused to confirm the existence of an official investigation, but said the Commission had previously come up against similar competition concerns when it investigated Volbroker.com, a banking exchange formed by Deutsche Bank. FXall is accused of trying to create a monopoly by preventing its members from working with other online currency trading services such as Atriax. After Atriax's closure last month, former members including Citibank, Deutsche Bank and Chase joined FXall, further strengthening its position. A spokesman for FXall admitted an investigation is underway, but told silicon.com: "We believe we're in compliance with the laws and regulations applying to this industry. Our participants have always been free to provide liquidity wherever they choose. We are confident in our openness and transparency."
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