US Group Issues New Broker 'Points' Guide
NEW YORK – The Foreign Exchange Committee, a US industry association affiliated to the Federal Reserve, has issued new guidelines on broker ‘points’ – the issue at the heart of last year’s massive Wall Street forex fraud.
The Committee has been debating the topic since the FBI swooped on 47 traders as part of ‘Operation Wooden Nickel’, an investigation into a series of currency scams, last November.
Broker points – the pips a broker may have to recoup on mis-matched trades – can arise legitimately, but in this case bank traders were alleged to be ‘cashing points’ – executing trades with brokers at loss-making rates for the bank – in return for cash. Traders at JP Morgan Chase, UBS, SG, Dresdner Kleinwort
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