Key Facts on BNY Mellon Foreign Exchange Litigation
When it comes to traditional standing instruction, many clients have made clear that this is a product they like, know how to use strategically and want to continue to leverage.
In addition, while the foreign exchange litigation has received outsized media attention, clients have been largely supportive and appreciate the value we provide.
BNY Mellon has thrived for 225 years because of its ability to adapt to the changing marketplace and help its clients do the same. The company will continue to evaluate and evolve its product offerings to ensure that they are meeting client demand and best positioning clients to navigate an increasing complex financial environment.
Along those lines, BNY Mellon has added to its existing foreign exchange trading product line a new defined spread product that offers:
Pricing based on objective rate sources where applicable, captured periodically throughout the day
Daily, guaranteed rates that provide protection against extreme currency fluctuations
Post-transaction reporting that includes the time at which we capture each rate, if applicable
Trade aggregation and price netting, subject to market and program parameters.
There have been positive developments on the legal front as well. BNY Mellon has received favorable and noteworthy rulings in the Virginia and California false claims act cases. These two back-to-back positive results are significant developments as they demonstrate that these types of claims cannot withstand legal scrutiny.
In the Virginia case, the Court dismissed the entire case against BNY Mellon, which consisted of claims under Virginia's version of the False Claims Act, or "whistleblower" claims against the company. Following the dismissal, the Virginia Attorney General's office formally withdrew its motion to file an amended complaint, effectively ending its lawsuit with BNY Mellon.
In the California case, the Court dismissed the California False Claims Act claims against the company. In deciding that the plaintiffs lacked a credible legal basis to pursue these claims, the Court eliminated the plaintiffs' ability to seek any significant financial penalties. Certain plaintiffs have filed an amended complaint in the case, which BNY Mellon has asked the court to dismiss.
These are important decisions because false claims act statutes tend to be similar from state to state and closely align with the federal False Claims Act. The company hopes that other courts in which BNY Mellon is litigating these issues will be guided by these well-thought out rulings.
The company remains committed to its clients and to continuing to evolve its products and services to meet client needs. It recognizes that times are changing, that competition for client business is fierce and that, more than ever, it must prove to clients that they come first. BNY Mellon and its entire front line are dedicated to not just meeting, but exceeding client expectations.