Five banks fined more than $3 billion in currency probe

Five banks fined more than $3 billion in currency probe

How big banks broke the rules

Five banks have agreed to pay $3.38 billion in fines to global regulators to resolve allegations that they attempted to manipulate foreign exchange rates.

Citibank (C), HSBC (HSBC), JPMorgan Chase (JPM), RBS (RBS)and UBS (UBS) will collectively pay $1.4 billion to the U.S. Commodity Futures Trading Commission and about £1.1 billion ($1.75 billion) to the U.K.'s Financial Conduct Authority. UBS will also make a payment in Switzerland.

The fines are the largest ever imposed by the British regulator, which said it will continue to investigate potential wrongdoing at Barclays (BCS).

Some $5 trillion is traded in the global currency market each day, much of it in London.Foreign exchange rates affect the price of imported goods, company earnings and many investments held by pension funds and others.

Between 2008 and 2013, lax controls at the banks allowed traders to share confidential information and collude with their counterparts at other institutions in an effort to fix rates and increase profits.

British regulators said traders used private online chatrooms to coordinate their buying and selling to shift currency prices in their favor, aiming to making a profit for their banks at the expense of clients.

The traders called themselves "the players", "the 3 musketeers" and the "the A-team."

The FCA said that the banks had failed to manage obvious risks, and that traders were allowed to behave unacceptably.

It is possible that the banks and individual employees will also face criminal charges in both the U.K. and U.S. over attempts to manipulate the rates.

Related: You may never have to rescue a bank again

While all five banks face more than $600 million in fines, UBS was also penalized by Swiss regulators, and will pay a total of $800 million. Citibank will pay the second largest total fine at $668 million.

British regulators said 36 banks that operate in the foreign exchange market, including the five fined Wednesday, will be required to participate in a program to change banking culture and ensure management take more responsibility.

A separate investigation into the actions of officials at the Bank of England found that no staffers were involved with alleged foreign exchange rigging. However, one official was found to have been aware of potential improper conduct, and failed to raise the issue.

The CFTC said that since June 2012, it has imposed penalties of more than $3.34 billion relating to the manipulation of global benchmarks.