FX Cartel demands further evidence from US Government

Maria Nikolova

The former Forex traders want the US Government to produce statements made by the chief witness to the competition authorities in Korea and Brazil, and the US Federal Reserve Bank.

As the parties in a Forex manipulation case are about to participate in a status conference at the New York Southern District Court today, some discovery-related issues have emerged. The defendants – Richard Usher, Rohan Ramchandani, and Christopher Ashton, who stand accused of conspiring to fix prices and rig bids for US Dollars and Euros in the FX spot market, are asking the Court to order the Government to produce extra evidence in this case.

Last year, the parties in the case, captioned USA v. Usher et al (1:17-cr-00019), had an argument about the testimony of the Government’s chief cooperating witness. The issues are back on the agenda now.

Let’s recall that in a Letter, dated November 16, 2017, the defendants, also known as “FX Cartel” or “FX Mafia” asked Honorable Richard M. Berman to compel the US Government to help them access statements by the chief witness to the UK Serious Fraud Office (SFO), Australia Competition & Consumer Commission (ACCC), and Korea Fair Trade Commission (KFTC).

On October 30, 2017, in response to an inquiry by the defendants, the US Government claimed that it did not participate in the interviews involving the foreign regulators, and that it does not possess “any written or recorded memorialization of any statements the Cooperating Witness made to these authorities.” Also, the US Government stated during a further meet-and-confer on Monday, November 13, that it remains unwilling to ask the SFO, ACCC, or the KFTC for the Cooperating Witness’s statements.

On Monday, June 25, 2018, the defendants submitted another Letter, stating that the Government has not produced all statements made by its chief cooperating witness to other regulatory and law enforcement agencies.

The Government has produced to the defendants the statement that the witness made to the Australian Competition & Consumer Commission (ACCC). However, the parties are aware of at least three additional statements – specifically, statements made to the competition authorities in Korea and Brazil, and a statement to the Federal Reserve Bank (FRB) in the United States. These statements are material to preparing the defense, yet the Government has declined to produce them.

According to the defense, these statements are made to regulators that subsequently found no antitrust violations in the same conduct at issue in the present case. Hence, the information may be very important for the defense.

The defendants request that the Court order the Government to produce the statements by August 7, 2018.

Usher, former Head of G11 FX Trading-UK at an affiliate of Royal Bank of Scotland plc, as well as former Managing Director at an affiliate of JPMorgan Chase & Co., Ramchandani, former Managing Director and head of G10 FX spot trading at an affiliate of Citicorp, and Ashton, former Head of Spot FX at an affiliate of Barclays PLC, are alleged to have conspired to manipulate the FX market by “coordinating their bidding, offering, and trading” at “certain times.”

Their trial was recently rescheduled and is set to start on October 1, 2018.

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