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Banks Sued for Rigging Market for Mexican Government Bonds

Banks Sued Over Rigging of Market for Mexican Government Bonds

(Bloomberg) -- More than a half-dozen banks were sued by the pension fund for Boston government employees, which alleged the institutions rigged the market for Mexican government bonds for more than a decade.

The Boston Retirement System sued banks including Banco Santander SA, JPMorgan Chase & Co. and Credit Suisse AG in federal court in New York Monday, accusing them of conspiring to fix prices for Mexican government bonds between 2006 and April 2017 by rigging auctions, selling bonds at artificially high prices and fixing spreads. The three banks didn’t immediately respond to requests for comment.

"This comprehensive scheme resulted in inflated MGB prices, and lower yield for plaintiff and the class they represent while generating supra-competitive profits for defendants," the pension fund said in its complaint.

Mexican antitrust regulators announced a probe of price manipulation in the country’s $400 million market for local bonds from government entities in April 2017. Bloomberg reported a month later that they had zeroed in on seven banks, citing a person with knowledge of the matter who didn’t want to be identified because the information was private. The securities regulator known as the CNBV also started its own investigation, three people with knowledge of the matter told Bloomberg in July.

The case is Boston Retirement System v. Banco Santander SA, 18-cv-4294, U.S. District Court, Southern District of New York (Manhattan.)

To contact the reporter on this story: Chris Dolmetsch in New York State Supreme Court in Manhattan at cdolmetsch@bloomberg.net.

To contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Joe Schneider, Elizabeth Wollman

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