Former Banker Convicted at Trial of Price-Fixing and Bid-Rigging in FX Market

On November 20, the U.S. Department of Justice announced that after a three-week trial in the Southern District of New York, a jury convicted Akshay Aiyer of participating “in an antitrust conspiracy to manipulate prices for emerging market currencies in the global foreign currency exchange (FX) market.”  Aiyer, a former JP Morgan Chase Executive Director and FX trader, was convicted on one count under section 1 of the Sherman Antitrust Act for “conspiring to fix prices and rig bids in Central and Eastern European, Middle Eastern and African (CEEMEA) currencies, which were generally traded against the U.S. dollar and the euro, from at least October 2010 through at least January 2013.”

The evidence presented at trial established the following:

• Aiyer “engaged in near-daily communications with his co-conspirators by phone, text and through an exclusive electronic chat room to coordinate their trades of the CEEMEA currencies in the FX spot market.”
• Aiyer and his co-conspirators “manipulated exchange rates by agreeing to withhold bids or offers to avoid moving the exchange rate in a direction adverse to open positions held by co-conspirators and by coordinating their trading to manipulate the rates in an effort to increase their profits.”
• By agreeing not to buy or sell at certain times, Aiyer and the other conspiring traders “protected each other’s trading positions by withholding supply of or demand for currency and suppressing competition in the FX spot market for emerging market currencies.”
• Aiyer and his co-conspirators “took steps to conceal their actions by, among other steps, using code names, communicating on personal cell phones during work hours and meeting in person to discuss particular customers and trading strategies.”

Aiyer is reportedly scheduled to be sentenced on April 3, 2020.  The release also noted that the investigation into FX spot market collusion is ongoing.

N.B.: This is the most recent conviction stemming from the Department of Justice’s Antitrust Division investigation of collusion in the FX spot market, and apparently the first involving a conviction at trial.  Although five financial institutions and two individual former traders have already pleaded guilty in the investigation, the Antitrust Division’s success in obtaining a conviction at trial could prompt further pleas.