Exclusive: Trading start-ups prep major bank antitrust suits

Thu Apr 14, 2016 7:11pm EDT
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By Mike Kentz

NEW YORK (IFR) - Two online trading start-ups are preparing antitrust suits alleging that major banks conspired to block customers from using their platforms to trade interest rate swaps.

TeraExchange and Javelin Capital Markets will claim the banks threatened to cut off customers who tried to trade on the platforms, sources familiar with the situation told IFR.

TeraExchange, which one source said could file suit as early as Friday, is readying charges against many of the biggest names in the banking industry.

Bank of America Merrill Lynch, Barclays, BNP Paribas, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, JP Morgan, Morgan Stanley, Royal Bank of Scotland and UBS will be named, the sources said.

The suit from Javelin is expected to come later, and it was not immediately known which banks the company would accuse.

The allegations mirror those in a lawsuit last year by a Chicago pension fund that accused the same 12 banks of trying to keep customers away from Tera, Javelin and other platforms.

That suit said the banks in question had effectively made it more expensive for investors such as the pension fund to trade in derivatives.

Tera and Javelin declined to comment, as did Thomas Ogden, the partner at law firm Wollmuth Maher & Deutsch who is preparing their lawsuits.   Continued...

A BNP Paribas bank logo is pictured outside its offices in Singapore's central business district January 7, 2016.  REUTERS/Edgar Su