Citi Must Face Trader’s Claims That He Was Forex ‘Scapegoat’

A former Citigroup Inc. trader who says the bank made him a “scapegoat” in a U.S. investigation of foreign exchange price fixing can move ahead with a $112 million lawsuit against his ex-employer.

Rohan Ramchandani, who was acquitted by a federal jury in 2018, sued the bank in 2019 claiming it leaked false information about him to the press and lied to regulators investigating the alleged price fixing. U.S. District Judge Victor Marrero on Thursday rejected Citigroup’s request to dismiss the case, ruling that Ramchandani had raised a plausible claim for relief.

The ruling is another legal setback for Citigroup, which last month lost a lawsuit it filed to recoup hundreds of millions of dollars it mistakenly sent to a group of hedge funds in August. The bank is appealing that decision, which was widely watched across Wall Street. Citi is also in the midst of upgrading its systems and technologies after the Office of the Comptroller of the Currency and the Federal Reserve cited deficiencies in both areas last year.

“Mr. Ramchandani’s claims of malicious prosecution are without merit and we will contest them vigorously,” Danielle Romero-Apsilos, a spokeswoman for the bank, said in an emailed statement.

‘The Cartel’

In 2018 a federal jury in New York rejected the U.S. case that Ramchandani, Richard Usher, a former JPMorgan Chase & Co. foreign exchange trader, and Chris Ashton, the ex-head of spot FX trading at Barclays Plc, rigged the foreign exchange market from 2007 to 2013 by coordinating trades and manipulating prices. Jurors found the three men, dubbed “the Cartel,” not guilty of conspiring through online chatrooms to manipulate the $5.1-trillion-a-day market.

Citigroup, JPMorgan Chase, Barclays and Royal Bank of Scotland Group Plc pleaded guilty to currency manipulation in 2015 as part of a $5.8 billion settlement with the U.S.

Ramchandani alleges that Citigroup chose to plead guilty to a fabricated crime the bank pinned on him, to avoid consequences including the loss of licenses. He claims the government based its prosecution on the false information.

“By successfully grounding its plea solely upon Ramchandani’s nonexistent crimes, Citi limited scrutiny of, and potential charges against, its own senior managers and officers,” he said in the lawsuit.

The case is Ramchandani v. Citigroup Inc., 19-cv-09124, U.S. District Court, Southern District of New York (Manhattan).

Read More: Ex-Citi Trader Renews Dismissal Lawsuit After Acquittal in U.S.

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