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‘Cartel’ currency traders will attempt to prevent US trial

Three British-based former currency traders will try to get their criminal case thrown out of a New York court before it reaches trial after surrendering to US authorities following their sprawling probe into alleged rigging of foreign-exchange benchmarks.

Christopher Ashton of Barclays, Rohan Ramchandani of Citigroup, and Richard Usher of JPMorgan Chase, who formed a chatroom dubbed “the Cartel”, decided not to fight extradition to the US after being charged by the US Department of Justice’s antitrust division earlier this year with a single count of manipulating the market for US dollars and euros.

They all deny wrongdoing. In a deal with the DoJ, they have agreed to surrender voluntarily and pay security in exchange for being able to travel back to the UK pending any trial. The agreement still needs to be approved by a judge and a hearing is scheduled in New York for July 17, when all three men expect to attend.

But they will try to avert any trial by running an argument that the court in the Southern District of New York does not have the jurisdiction to hear their case, according to three people familiar with the situation.

They will argue that they were all British-based traders working in the UK at the time of the alleged wrongdoing, and that the UK’s Serious Fraud Office decided last year to drop its own probe into forex-rigging after concluding there was insufficient evidence to mount a successful prosecution.

They will also point to the extreme scale of the euro-dollar market to cast doubt on whether it was possible for three traders to manipulate the world’s most liquid currency trade, those people added.

The DoJ declined to comment on the case.

The traders were nicknamed the “Cartel” and also the “Mafia” in chatroom messages that were at the heart of multi-bank civil settlements with US and UK authorities in 2014 and 2015. Some of the biggest banks in the world — including those where the traders used to work — have paid a total of $10bn in fines as part of the scandal.

The charges carry a maximum penalty of 10 years in prison and a $1m fine. The maximum fine may be increased to twice the gain derived from the alleged crime or twice the loss suffered by victims if either amount is greater than $1m.

The trio’s decision to surrender to US authorities stands in contrast to that of Stuart Scott, HSBC’s former London-based head of currencies trading who, along with his ex-boss Mark Johnson, 51, was indicted last year by the DoJ’s fraud section in a separate strand of the forex probe. Mr Scott, who lives near London, was arrested last week in the UK at the behest of US authorities. He will contest extradition and denies wrongdoing.