The FCA said it is investigating allegations of foreign exchange market manipulation (Reuters)

The UK's Financial Conduct Authority has confirmed it is probing the foreign currency markets amid reports that a number of regulators are investigating allegations of market manipulation by some of the world's biggest banks.

Each day, $4.7tn (€3.5tn, £3tn) changes hands in the world's currency market. It is the largest market in the financial system.

US, Swiss and Hong Kong regulators are reported to have launched their own investigations into allegations of currency market manipulation.

"We can confirm that we are conducting investigations alongside a number of other agencies both in the UK and abroad into a number of firms relating to trading on the foreign exchange (forex) market," said a spokesman for the FCA.

"As part of this we are gathering information from a wide range of sources including market participants. Our investigations are at an early stage and it will be some time before we conclude whether there has been any misconduct which will lead to enforcement action.

"We will not comment further on our investigations."

None of the global regulators have gone into detail over exactly who they are investigating and on what specific allegations.

"Finma is currently conducting investigations into several Swiss financial institutions in connection with possible manipulation of foreign exchange markets," the Swiss regulator said in a statement, adding it is co-ordinating closely with authorities in other countries as multiple banks around the world are potentially implicated.

Honk Kong's Monetary Authority said it is "aware of the [forex market manipulation] allegations. We have been in communications with the relevant overseas regulators and following up with individual banks."

In the US, both the Department of Justice and the FBI have launched a criminal investigation into potential currency market manipulation.

According to reports, JPMorgan's chief dealer in London, Richard Usher, is tipped to be the trader at the centre of one of the probes related to his time at his former employer, the Royal Bank of Scotland. The FCA, RBS and JPM declined to comment to IBTimes UK.

A separate report claimed that RBS has handed over to the FCA instant messages sent by one of its currency traders.