Former HSBC Executive Convicted of Fraud for Front-Running
October 23 2017 - 01:58PM
Dow Jones News
By Rebecca Davis O'Brien
A federal jury in Brooklyn on Monday found a former high-ranking
HSBC Holdings PLC executive guilty on charges that he misused
information about a client's $3.5 billion currency trade to make
millions of dollars for the bank.
Mark Johnson, HSBC's former global head of foreign-exchange cash
trading, was the first banker to face criminal charges stemming
from a U.S. Justice Department probe into foreign exchange rate
manipulations. He was convicted on eight counts of wire fraud and
one count of wire-fraud conspiracy; he was acquitted on a ninth
wire-fraud count.
Lawyers for Mr. Johnson couldn't immediately be reached for
comment. A spokesman for the Brooklyn U.S. attorney's office didn't
immediately have a comment on the verdict.
A spokesman for HSBC didn't immediately respond to requests for
comment. Mr. Johnson left HSBC earlier this year.
Mr. Johnson, a British citizen, wasn't accused of rigging
exchange rates, the main focus of the broader Justice Department
probe.
Instead, he and a colleague, Stuart Scott -- HSBC's former
European head of currency trading -- were charged in connection
with a practice known as front-running, in which someone with
advance knowledge of a major market order buys for their own
account, then earns a profit when the larger transaction drives up
the price.
Mr. Scott, who left HSBC in 2014, is in the U.K. fighting
extradition and wasn't tried alongside Mr. Johnson. A lawyer for
Mr. Scott couldn't immediately be reached for comment.
(END) Dow Jones Newswires
October 23, 2017 13:43 ET (17:43 GMT)
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