The US Department of Justice is scrutinising currency-linked investments marketed by Barclays and UBS in an indication that the sprawling global probe into the foreign exchange market may become more troubling for banks.
The Financial Times reports that the DoJ is examining whether the two banks sold so-called structured products without disclosing the profit they were making from currency trades used to generate the products’ returns, said people familiar with the investigation.
These products were sold to sophisticated investors, including several Swiss hedge funds.
In addition to its probe of Barclays’ and UBS’s sales, the agency is investigating other banks over allegations of inadequate profit disclosure to clients and counterparties involved in currency deals, the people said.
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