U.S. prosecutors are broadening their investigation of the foreign-exchange industry as they question salespeople at the world's biggest banks on their practices, according to two people with knowledge of the matter.
The Department of Justice has been asking bankers and clients how much sales teams charge customers to exchange currency, the people said, asking not to be identified because the interviews are private. The move is the first indication prosecutors are probing sales practices.
According to more than a dozen current and former salespeople and traders interviewed by Bloomberg News, it's common to charge what's known as a hard markup, tacking on a small margin for a salesperson's services. Some clients who make currency deals infrequently or in small amounts are known to pay little attention to the rates they get. The Justice Department is scrutinizing whether banks committed fraud by failing to disclose the practice properly to customers, the people said.
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