Qatar sues Luxembourg, UAE, Saudi banks in FX manipulation case

Qatar said on Monday it had filed lawsuits against three banks, accusing them of using what it called overseas currency manipulation to sabotage its economy in the wake of an Arab boycott against the country in 2017.

The cases, filed in London and New York, name Luxembourg-based Banque Havilland, the United Arab Emirates’ First Abu Dhabi Bank (FAB) and Saudi Arabia’s Samba Bank, a statement from Qatar’s government communications office said.

None of the banks had any immediate comment on the Qatari accusations.

Qatar said Banque Havilland tried to weaken the country’s riyal currency by submitting what the statement called fraudulent quotes to foreign-exchange platforms in New York, to disrupt indices and markets where significant Qatari assets and investors are located.

The statement did not go into detail about the accusations against FAB and Samba Bank, nor did it state the extent of the alleged damage or compensation being sought.

The lawsuits are the latest fallout in a protracted Gulf row that began in 2017 when Saudi Arabia, the United Arab Emirates, Bahrain and Egypt imposed an economic boycott on Qatar in 2017, accusing it of supporting Islamist militants and Iran.

Qatar, a small Gulf state but major gas exporter, denies the charges and says the boycott is an attempt to impinge on its sovereignty.

Its central bank began a probe into alleged foreign-exchange manipulation in late 2017 after it said unnamed banks were looking to attack the riyal by trading it between themselves offshore at artificially weak levels – to create an illusion Qatar’s economy was crumbling.

The riyal has been pegged to the U.S. dollar at a rate of 3.64 for more than a decade, but in the initial months of the boycott it traded as low as 3.8950 offshore before returning to normal levels.

With more than $300 billion in central bank reserves and sovereign wealth fund assets, bankers say Qatar has sufficient financial firepower to block attacks on its currency.

Source: News Agencies