JPMorgan Chase, Goldman Sachs, UBS and Morgan Stanley To Pay $499,000,000 Following Anti-Competitive Accusations

A class action lawsuit filed in 2017 by US pension funds, led by the Iowa Public Employees’ Retirement System, accused JPMorgan, Goldman Sachs, UBS, and Morgan Stanley of attempting to prevent competition in the stock-lending market.

The banks are said to have tried to monopolize the market with their own platform called EquiLend while obstructing the development of new platforms for electronic securities borrowing and lending.

As a settlement, the four banks will pay a combined sum of $499 million.

EquiLend, originally established in 2001 by Barclays Global Investors, Bear Stearns, Goldman Sachs, JPMorganChase, Lehman Brothers, Merrill Lynch, Morgan Stanley, Northern Trust, State Street, and UBS Warburg, is now owned by Bank of America.

The lawsuit involving Credit Suisse and Bank of America has resulted in an $81 million fine for Credit Suisse, while Bank of America has yet to settle.

EquiLend, another defendant in the case, has denied any wrongdoing and settled to maintain its business operations.

The plaintiffs aim to prevent similar anti-competitive practices in the future through the settlement. None of the banks have released a statement on the matter.

“While Defendants have denied any wrongdoing and that any reforms were necessary, Plaintiffs believe that the equitable relief they designed and negotiated for will help align EquiLend to the best practices and guidelines for anti-cartel and collaborations among competitors.”

The notes continued and stated the following according to the latest reports coming from the online magazine the Daily Hodl:

“Plaintiffs believe the reforms should materially decrease the likelihood of future collusion in the stock lending market, and thus Plaintiffs believe the reforms thereby increase the chances the industry would transition to a more competitive trading environment.”

In other recent news, we revealed the fact that according to Bloomberg, the Financial Accounting Standards Board (FASB), the organization responsible for setting accounting standards in the US, has approved new regulations for calculating the value of crypto assets on a company’s balance sheet.