Plaintiffs in Forex manipulation case seek help from UK judicial authorities

Maria Nikolova

The plaintiffs in a US case targeting major banks want the judicial authorities of England to help them obtain the testimony of Matthew Gardiner.

Plaintiffs in a US lawsuit targeting some of the world’s major banks like Barclays PLC, Citigroup Inc., HSBC and JPMorgan Chase & Co. are seeking the assistance of UK judicial authorities in order to obtain testimony from Matthew Gardiner, a former employee of several of the defendants in the lawsuit.

On April 10, 2019, the plaintiffs submitted a raft of documents with the New York Southern District Court moving the Court to request the assistance of UK authorities. The request for assistance is said to be made made pursuant to Chapter I of the Hague Convention of 18 March 1970 on the Taking of Evidence in Civil or Commercial Matters.

Let’s note that the action involves claims of a conspiracy to violate the antitrust laws of the United States. Mr Gardiner is a former employee of at least three of the defendant banks in this action, Barclays, UBS, and Citicorp. In his employment at each defendant, Mr. Gardiner served as a Foreign Exchange trader in G10 currencies at Barclays,UBS, and Citicorp in New York and in London. He is said to have knowledge relevant to this action. Gardiner, a non-party to the US action, resides in the United Kingdom.

The case in question involves claims based on an alleged conspiracy among banks, including Barclays, UBS, and Standard Chartered, to fix prices in the FX market in violation of the Sherman Antitrust Act, 15 U.S.C. §§1. The plaintiffs – John Nypl, Lisa McCarthy, Mad Travel, Inc. a.k.a. Travel Leaders; Valarie Jolly, Go Everywhere, Inc., William Rubinsohn, rubinsohn Travel, Inc. on behalf of themselves and those similarly situated, seek damages and other relief for injury caused by the defendants’ wrongdoing. The plaintiffs allege, inter alia, that the defendant banks, including Barclays, UBS, and Citicorp conspired to fix FX prices and otherwise manipulate the FX market from a period beginning at least as early as January 1, 2007 through December 31, 2013, in violation of U.S. antitrust and commodities exchange laws.

The plaintiffs allege that the defendants used electronic chat rooms with names such as “The Cartel,” “The Bandits’ Club,” and “The Mafia” in furtherance of the conspiracy. Further, the plaintiffs allege that over time, various chat rooms evolved to discuss numerous currency pairs beyond those for which they were originally established. The plaintiffs claim that they purchased foreign currency at prices that were inflated by the defendants’ conspiracy and agreement to fix prices. The defendants deny they entered into any agreement to fix prices or otherwise manipulate the FX market.

The plaintiffs ask the New York Southern District Court to request that appropriate judicial authority in England cause the appropriate orders to be issued to direct the deposition, under oath, of Mr. Mathew Gardiner to be used at trial in these proceedings.

According to the plaintiffs, Mr. Gardiner’s testimony regarding his knowledge of the FX market is relevant to establishing the existence of conspiracy and market manipulation. In addition, Mr. Gardiner’s testimony regarding his knowledge of communications with each codefendant from 2007 through 2013, including in multi-bank chat rooms, is relevant to prove conspiracy.

Also, according to the plaintiffs, beginning as early as 2007 and continuing through at least 2013, Mr. Gardiner was an active participant in multibank chat rooms with FX traders of the defendant banks. Mr. Gardiner’s testimony regarding his chat room communications is seen as relevant to explain at trial, numerous multi-bank chats in which he participated because FX traders have their own unique jargon and codes that are difficult to interpret.

Moreover, Mr. Gardiner’s testimony regarding his knowledge of compliance issues is said to be relevant for trial because the plaintiffs intend to prove either that the defendant banks lacked compliance measures to prevent the conspiracy and/or knew of violations of compliance policies and failed to prevent them.

The plaintiffs seek that the judicial authority in England permit the examination of Mr. Gardiner to be conducted by attorneys for the plaintiffs or other duly authorized Representatives, qualified to practice law in United States jurisdictions and/or in England and Wales, nominated by the plaintiffs, and that the plaintiffs be permitted to cross-examine Mr. Gardiner.

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