Former HSBC trader is the first to be convicted as part of the global currency-rigging scandal.

By Joe McDonough

Posted on October 24, 2017

A former HSBC currency trader was found guilty on Monday (US time) of defrauding one of Europe’s leading independent energy firms in a $US3.5 billion client order.

Mark Johnson — who was HSBC’s head of global cash foreign exchange trading — was convicted of nine of 10 fraud and conspiracy counts relating to HSBC’s execution of a trading order from Cairn Energy in 2011 to convert the proceeds of a unit sale from dollars into pounds.

The Independent reports that Mr Johnson, 51, was accused of exploiting confidential information from Cairn Energy in 2011 to “front run” the oil and gas firm in the currency markets, resulting in an $US8 million profit for the bank at the expense of its client.

Jurors listened to a voice recording of Mr Johnson saying, “Oh, f*cking Christmas”, on learning of Cairn’s decision to proceed with the trade.

Oh, f*cking Christmas — Mark Johnson said in a damning voice recording

The month-long trial in Brooklyn was the first of its kind since the global currency-rigging scandal, which resulted in global banks paying more the $US10 billion in penalties.

Mr Johnson is to remain in New York. He was forced to surrender his passport as he awaits sentencing. Each count carries a maximum 20-year prison, according to the Bloomberg, although Johnson is likely to receive a shorter sentence.

“They’ve convicted an innocent man,” defence lawyer John Wing told reporters as he left courtroom.

HSBC, which itself wasn’t accused of being complicit, is in settlement talks with US regulators and the Justice Department over currency trading.

“This sends a signal to traders and banks that this type of behaviour is absolutely inappropriate and will be pursued by the government,” said Michael Weinstein, a former Justice Department attorney.”