JPMorgan Chase & Co and Bank of New York Mellon have won the dismissal of lawsuits accusing them of overcharging clients for trading currencies.
U.S. District Judge Denise Cote has dismissed a lawsuit that accused the U.S. bank of breaching a fiduciary duty to custodial clients by charging "hidden and excessive mark-ups" on currency trades.
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The JPMorgan lawsuit was led by the Louisiana Municipal Police Employees’ Retirement System, and sought class-action status on behalf of pension fund custodial clients.
Meanwhile, the Bank of New York Mellon lawsuit was led by the Iron Workers Mid-South Pension Fund and by California resident Marilyn Clark, and sought to force executives and directors to reimburse the bank for damages.
In her decision, Cote rejected allegations that the underlying JPMorgan custodial agreement obligated the bank to process trades at "the best available market rate" or by any other particular measure. She also said that there was "nothing secret about the mark-ups" charged because they were disclosed in public databases and on trade confirmations.
Cote’s colleague, Lewis Kaplan, said that it is improper to hold Bank of New York Mellon executives and directors responsible for practices that the plaintiffs said resulted in more than US$2 billion of liabilities, and damaged the bank’s bottom line, credit rating, reputation and stock price.
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By GlobalData
