SAO PAULO—Brazil's antitrust agency is investigating banking
giants HSBC Holdings PLC, Citigroup Inc., Deutsche Bank AG and a
long list of their peers on suspicion of forming a cartel to
manipulate the exchange rate of the Brazilian currency, the
real.
The agency, known as CADE, said Thursday there are "strong
indications" of the use of anticompetitive practices in the
foreign-exchange market by the three big banks and a number of
other U.S. and overseas lenders.
CADE said there was evidence the banks worked together to fix
the exchange rate, coordinate the buying and selling of currencies
and impede the operations of other banks operating in Brazil's
foreign-exchange market, among other things.
HSBC in Brazil and Deutsche Bank declined to comment on the
allegations. Citigroup had no immediate comment. Credit Suisse
Group AG, one of the other banks named by CADE, had no immediate
comment.
The alleged acts took place from at least 2007 to 2013, CADE
said. The banks coordinated their actions using chat services
provided by Bloomberg LP, and some of the participants referred to
the group as "the cartel" or "the mafia," according to CADE.
Bloomberg had no immediate comment.
Bloomberg is a competitor of The Wall Street Journal in the
provision of financial news.
The banks also collaborated to influence certain reference
indexes that affect the exchange market such as the Central Bank of
Brazil's PTAX rate, CADE said. The banks shared information on
clients' orders, futures contract prices and the size of operations
already carried out, among other things, according to CADE.
At least one of the participants in the alleged cartel is
cooperating with authorities, CADE said.
Write to Jeffrey T. Lewis at jeffrey.lewis@wsj.com and Rogerio
Jelmayer at rogerio.jelmayer@wsj.com
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