A bank holding company agreed to pay civil money penalties of approximately $110 million to settle charges of failing to supervise foreign exchange ("forex") traders' communications and activities. The charges were brought by the Board of Governors of the Federal Reserve System ("FRB") and the New York Department of Financial Services ("DFS") (collectively, the "agencies").
According to the consent orders issued by the FRB and DFS, Goldman Sachs Group, Inc. ("Goldman") did not maintain sufficient policies and procedures to identify and prevent "unsafe and unsound" activities conducted by certain forex traders between 2008 and early 2013. During this period of time, certain Goldman forex spot market traders allegedly disclosed confidential customer information and trading activity with traders at other financial institutions through electronic messaging platforms in order to increase profits from FX trades. Additionally, some of these traders engaged in trading strategies that involved conflicts of interest.
FRB and DFS noted Goldman's cooperation with regulators' investigations. In addition to the monetary penalties, Goldman agreed to implement a number of measures to improve its internal controls and programs to comply with applicable New York State and federal laws and regulations.
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