Top banks want Court to accept their definition of “foreign currency retail transactions”
Major banks, like JPMorgan and Citi, argue that foreign exchange transactions involving credit, debit, and ATM card transactions should be excluded from a Forex benchmark rate fixing case.
A Forex benchmark rate fixing case targeting some of the world’s major banks like JPMorgan Chase & Co. (NYSE:JPM), JPMorgan Chase Bank, N.A., Barclays Capital, Inc., Citibank, N.A., Citigroup Inc (NYSE:C), Bank of America Corp (NYSE:BAC), Bank of America, N.A, HSBC Bank USA, N.A., and HSBC North America Holdings, Inc. has turned into a conceptual dispute during the past several months. The definition of “foreign currency retail transactions” has been at the heart of the disagreements between the plaintiffs and the defendant banks.
Why is the definition important in this case? Because it it will define the scope of the action and the size of the class. Plaintiffs are said to be “consumers and businesses who purchased physical foreign currency at defendant banks’ retail branches in the United States”. Whereas the plaintiffs claim that “foreign currency retail transactions” cover overseas transactions involving credit, debit, and ATM cards as well, the banks claim that foreign exchange transactions involving credit, debit, and ATM card transactions are not part of this case.
In June this year, the Court sided with the banks. But the plaintiffs have then asked for reconsideration. On Friday, August 17th, the banks filed a Letter with the New York Southern District Court, opposing the plaintiffs’ motion.
According to the banks, the plaintiffs fail to identify any matter or controlling decision that this Court “overlooked,” as required on a motion for reconsideration.
The banks say that the plaintiffs’ motion simply restates arguments that were already rebuffed by the Court: such as the fact that the term “purchase” implicitly includes credit, debit and ATM card transactions.
The banks also address the plaintiffs’ referral to the “Federal Reserve Payments Study 2016”. In particular, the plaintiffs argue that the Payments Study “confirms” that their complaint’s use of the term “purchase” should be read to include overseas foreign exchange transactions via credit, debit, and ATM cards. However, according to the banks. the Payments Study has nothing to do with the foreign exchange transactions at all, as the Payments Study never mentions “FX” or “foreign exchange.” Instead, the Payments Study merely identifies “trends in noncash payments in the United States,” and states that noncash payments (i.e., payments through credit and debit cards) increased in the United States from 2012 to 2015.
In sum, according to the defendant banks, the plaintiffs have not provided any basis for the Court to reconsider its conclusion that foreign exchange transactions involving credit, debit, and ATM card transactions are not, and never have been, part of this case.
The case, captioned Nypl v. JP Morgan Chase & Co. et al (1:15-cv-09300), continues at the New York Southern District Court.
