Said to be part of the UK Treasury’s reforms, the latest move is expected to help avoid banks from defrauding clients, people with knowledge of the matter said.
Time stamps, which are used in wholesale forex markets already, creates a paper trail for complete transparency, enabling clients to see when their spot trades were executed accurately. Officials say this will make them less vulnerable to frauds and instances of overcharging by banks.
In June, final recommendations will be published by Bank of England for the fair and effective markets review, reported Bloomberg.
Conducted along with the UK Treasury and the Financial Conduct Authority, the joint effort places emphasis on the method of making the fixed income, currency as well as commodity markets operate without any ambiguity.
Authorities around the globe are investigating allegations of corruption in the currency market valued at $5.3tn-a-day involving some of the global banks due to which forex practices are undr the scanner for the past two years.
According to advocates of time stamps, with the new rule in place, bank customers will be able to see the forex rates offered during the time of transaction.
Time stamps are not in use in spot trades for retail as well as institutional investors.
Image: The Bank of England in Threadneedle Street, London. Photo: courtesy of Adrian Pingstone
