IG’s bill for the Swiss franc bombshell swells after watchdog’s rulingComments Off on IG’s bill for the Swiss franc bombshell swells after watchdog’s ruling
Spread-betting giant IG Group’s bill for currency market turmoil rose by £1 million after the Financial Ombudsman Service criticised its handling of the Swiss franc crisis.
The Swiss National Bank dropped a bombshell in money markets on January 15 when it scrapped its €1.20 cap for the Swiss franc against the euro.
The move sent the value of the Swissie soaring and left hundreds of IG clients who were betting the other way with huge bills.
Some clients — angry at IG settling their trades when the euro was close to its weakest against the Swissie — took their case to the ombudsman earlier this year. It has ruled that IG complied with terms and conditions and acted “fairly” in processing client orders.
However, it found that a different price “beneficial to the client in this case, would have been more reflective of the underlying market liquidity, in what were unprecedented market circumstances”.
IG has decided to accept the ruling and apply it to other clients, taking its bill for the fiasco up from £27 million to £28 million.
Shares in the spread-better today dipped 3.5p to 760.5p.