Banks including JPMorgan Chase, Barclays and Citigroup will face a class action suit over allegations of foreign exchange manipulation after a London judge gave a full trial the go-ahead.
The FX collusion claim, which is also being brought against NatWest Group Plc, UBS Group AG and Mitsubishi UFJ Financial Group Inc., could be worth as much as £2.7 billion ($3.5 billion), according to estimates from lawyers Hausfeld running the suit.
The claims stem from the banks' participation in unlawful FX spot trading cartels between 2007 and 2013. The lenders subsequently admitted the behavior to the European Commission and were fined €1.1 billion ($1.2 billion).
Traders' manipulation of benchmark foreign-exchange rates was exposed in 2013, triggering regulatory probes in the U.S., the U.K. and Switzerland. More than a dozen financial institutions have paid over $12 billion in fines and penalties globally, with billions more spent to compensate customers and investors.
A spokesperson from Barclays didn't respond to a request for comment. Spokespeople from the other five banks declined to comment.
Judges at London's Court of Appeal ruled Tuesday that a class action case against the lenders could proceed on what's known as a "opt-out basis." This means that the suit is filed brought on behalf of potentially thousands of market participants impacted by the collusion without needing their permission to proceed.
The U.K.'s opt-out class action regime, known as collective proceedings, began to gain traction in 2021. No claims were allowed to go ahead in the five years the process came into effect in 2015, but in 2021 the first batch of suits were given the green light. There are several pending claims against Big Tech's market dominance in the Competition Appeal Tribunal.
"This ruling acknowledges the practical difficulties of opt-in legal proceedings and confirms the access to justice principle which underpins the collective action regime," Phillip Evans, the representative of the group, said. "The opt-out approach is crucial to ensure that claims may be pursued on behalf of all affected individuals and businesses."
