The European Commission said on Thursday it fined Royal Bank of Scotland (RBS), Barclays, Citigroup, JPMorgan and MUFG €1.07 billion for participating in a foreign exchange spot trading cartel.

“In two settlement decisions, the European Commission has fined five banks for taking part in two cartels in the spot foreign exchange market for 11 currencies – Euro, British Pound, Japanese Yen, Swiss Franc, US, Canadian, New Zealand and Australian Dollars, and Danish, Swedish and Norwegian crowns,” said the European Commission.

“The first decision (so-called “Forex – Three Way Banana Split” cartel) imposes a total fine of €811,197,000 on Barclays, The Royal Bank of Scotland (RBS), Citigroup and JPMorgan.

“The second decision (so-called “Forex- Essex Express” cartel) imposes a total fine of €257,682,000 on Barclays, RBS and MUFG Bank (formerly Bank of Tokyo-Mitsubishi).

“UBS is an addressee of both decisions, but was not fined as it revealed the existence of the cartels to the Commission.”

Commissioner Margrethe Vestager, in charge of competition policy said: “Companies and people depend on banks to exchange money to carry out transactions in foreign countries. 

“Foreign exchange spot trading activities are one of the largest markets in the world, worth billions of euros every day.

“Today we have fined Barclays, The Royal Bank of Scotland, Citigroup, JPMorgan and MUFG Bank and these cartel decisions send a clear message that the Commission will not tolerate collusive behaviour in any sector of the financial markets.

“The behaviour of these banks undermined the integrity of the sector at the expense of the European economy and consumers”.

Foreign Exchange, or “Forex”, refers to the trading of currencies.

When companies exchange large amounts of a certain currency against another, they usually do so through a Forex trader.

The main customers of Forex traders include asset managers, pension funds, hedge funds, major companies and other banks.