New York, Nov 20: US federal prosecutors filed charges against 47 traders in the foreign exchange market, after an FBI undercover operation exposed a murky world of fraud, corruption and narcotics trafficking. The majority of suspects were arrested in raids on Tuesday and yesterday that saw expensive-suited traders hauled out of their offices in Wall Street and elsewhere.

One group was grabbed as they gathered for cocktails in a skyscraper in New York's financial district, prior to what they believed would be a gambling junket to Atlantic city.

Instead the gathering was raided in a sting operation by armed FBI agents. US Attorney James Comey said the 18-month investigation -- code-named "operation wooden nickel" -- had exposed "a staggering array of criminal conduct" by people working in and around the foreign exchange business.

"Today's charges run the gamut of fraud," said Comey. "With more than 1,000 victims, from small investors to large banks, the losses are in the millions."


The charges included perjury, money-laundering, extortion, bankruptcy fraud, narcotics trafficking and even firearms offenses. "When the FBI placed an undercover in the forex world posing as a bad guy ... He had more criminal schemes thrown at him than you could imagine," Comey said.

The sweep netted traders at major financial institutions as well as so-called "boiler-room" dealers who preyed on small investors.

Bureau Report