"The defendants placed personal and company profits ahead of their duties of trust and confidentiality owed to their client, and in doing so, defrauded their client of millions of dollars."
British executive Mark Johnson was arrested by Federal agents at JFK International Airport, according to the US Department for Justice.
The complaint alleges that Johnson and Stuart Scott caused the $3.5 billion foreign exchange transaction to be executed in a manner that was designed to spike the price of the Pound Sterling, to the benefit of HSBC and at the expense of their client.
In total, HSBC allegedly generated profits of roughly $8 million from its execution, including profits generated from the front running conduct by Johnson, Scott, and other traders whom they directed.
U.S. Attorney Robert Capers said: “As alleged, the defendants placed personal and company profits ahead of their duties of trust and confidentiality owed to their client, and in doing so, defrauded their client of millions of dollars. When questioned by their client about the higher price paid for their significant transaction, the defendants wove a web of lies designed to conceal the truth and divert attention away from their fraudulent trades. The charges and arrest announced today reflect our steadfast commitment to hold accountable corporate executives and licensed professionals who use their positions to fraudulently enrich themselves.”
