George Osborne said Britain has been taking "tough action to clean up corruption by a few so that we have a financial system that works for everyone".
George Osborne said Britain's regulatory response to the financial crisis meant "the world can have confidence in the integrity of Britain's financial markets."
Mr Osborne said:
Today we take tough action to clean up corruption by a few so that we have a financial system that works for everyone. It’s part of a long term plan that is fixing what went wrong in Britain’s banks and our economy.
A number of traders have been suspended or fired, and the Serious Fraud Office are conducting criminal investigations. The banks that employed them face big fines - and I will ensure that these fines are used for the wider public good.
The Financial Conduct Authority said today's record fines over the foreign exchange (Forex) rigging scandal "mark the gravity of the failings we found".
FCA chief executive Martin Wheatley said in a statement:
The FCA does not tolerate conduct which imperils market integrity or the wider UK financial system.
Today’s record fines mark the gravity of the failings we found and firms need to take responsibility for putting it right.
They must make sure their traders do not game the system to boost profits or leave the ethics of their conduct to compliance to worry about.
The Bank of England has said there is no evidence any of its officials were involved in any "unlawful or improper behaviour" in relation to the foreign exchange market.
The Bank published an independent report by Lord Grabiner QC covering the period 2005-2013, which found that no Bank staff were aware of any improper behaviour by banks caught up in a wide-ranging Forex scandal.
The US Commodity Futures Trading Commission has imposed fines totalling $1.4 billion (£879 million) on five banks over the Forex rigging scandal.
The penalties on the banks were issued as follows:
- Citibank - $310 million
- JPMorgan - $310 million
- RBS - $290 million
- UBS - $290 million
- HSBC - $275 million
Five banks have been issued fines by the Financial Conduct Authority over the foreign exchange (Forex) rigging scandal for "failing to control business practices".
The penalties are as follows:
- HSBC - £216,363,000
- Citibank - £225,575,000
- JPMorgan Chase Bank £222,166,000
- Royal Bank of Scotland £217,000,000
- UBS - £233,814,000
Barclays has not been named as one of the banks taking part in the FCA settlement.
Five banks have been fined a total of £1.1 billion over the foreign exchange (Forex) rigging scandal.
The Financial Conduct Authority said it was imposing the fines for "failing to control business practices in their G10 spot foreign exchange".
Six banking firms are braced for heavy fines over the foreign exchange (Forex) rigging scandal.
HSBC, Royal Bank of Scotland, Barclays, Citigroup, UBS and JP Morgan have all set aside money to pay whatever penalty the Financial Conduct Authority deems necessary.
ITV News Economics Editor Joel Hills explains:
The City regulator looks set to impose more than £1 billion in penalties on banks caught up in the foreign exchange (Forex) rigging scandal.
Six firms are said to have been in talks with the Financial Conduct Authority to reach a settlement over the alleged misconduct relating to the £3 trillion-a-day market.
Reports suggest each bank could face a penalty of between £225 million and £250 million, adding up to around £1.4 billion in total.
This would dwarf the £532 million in penalties imposed by the regulator on banks and City brokers over the previous big regulatory scandal involving the manipulation of the interbank lending rate, Libor.
Business Secretary Vince Cable has welcomed the launch of an inquiry into the dominance of major banks in the UK.
Mr Cable said Britain needed a "more competitive and effective banking market" that gives consumers more choice away from the big banks.
Business leaders also welcomed the CMA's announcement which "put business banking under the microscope".
John Longworth, director general of the British Chambers of Commerce, said Britain's "dysfunctional banking sector" which "impeded the growth prospects" of companies needed to be reviewed.
An in-depth competition investigation is to take place into the market for personal and business accounts.
The Competition and Markets Authority (CMA) said it was concerned over the low levels of customers switching amid the "limited transparency and difficulties" in making comparisons between banks.
It said there had been "very little movement" in the market shares of the four largest banks, which are Barclays, HSBC, Lloyds Banking Group and Royal Bank of Scotland (RBS).
The CMA also said it would investigate the continuing barriers of entry and expansion in the sector, which "limit the ability of smaller and newer providers to develop their businesses".