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Press Release

New York Broker-Dealer Pleads Guilty To Violating U.S. Antitrust Laws by Rigging Bids for Financial Instruments

For Immediate Release
Office of Public Affairs
First Charge Filed in Ongoing Pre-Release ADRs Investigation

Banca IMI Securities Corp. (Banca IMI), a New York broker-dealer, pleaded guilty to an antitrust charge and was sentenced to pay a criminal fine in excess of $2 million for its involvement in a bid-rigging conspiracy for certain financial instruments, the Department of Justice announced today.

Banca IMI admitted, as part of its guilty plea, that from March 2012 until at least August 2014, it conspired with other institutions and individuals to submit rigged bids to borrow pre-release American Depository Receipts (ADRs).  Worldwide, thousands of publicly traded companies list their shares of common stock only on foreign stock exchanges.  Most U.S. investors are unable to purchase or sell such foreign shares.  The U.S. Securities and Exchange Commission, however, permits four U.S. depository banks to create ADRs, which represent foreign ordinary shares and can be traded in the United States.  Through the purchase and sale of ADRs, U.S. investors are able to gain exposure to — including the ability to receive dividends from — companies whose common stock is listed only on foreign stock exchanges. 

Banca IMI pleaded guilty to conspiring to borrow pre-release ADRs from U.S. depository banks at artificially suppressed rates.  During the conspiracy, a U.S. depository bank began using an auction-style process for pre-release ADRs and invited Banca IMI and other broker-dealers to submit competitive bids for rates to borrow ADRs.  In response, Banca IMI and its co-conspirators intensified their coordination in an effort to increase artificially their profits under the auction-style process.  On at least 30 occasions, Banca IMI reached an agreement with one or more co-conspirators as to the bids they would submit to U.S. depository banks.  On many occasions, the conspirators agreed that they all would submit the same bid. 

“Today’s charge represents the commitment of the Department of Justice and its law enforcement partners to uncovering and prosecuting cheaters who corrupt our financial and capital markets,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division.  “Complex financial markets are not beyond the reach of the antitrust laws.  The Antitrust Division will aggressively pursue criminals in technically complicated markets, including those that some wrongly presume may be beyond detection or the reach of antitrust enforcement.”

“The FBI is committed to rooting out corruption and fraud against the United States wherever it occurs,” said Assistant Director Robert Johnson of the FBI’s Criminal Investigative Division.  “The guilty plea today is the result of the FBI International Corruption Unit’s persistent and ongoing efforts to protect competition and identify those engaged in anticompetitive, fraudulent conduct. We will continue to pursue antitrust investigations aggressively with our DOJ partners.”

The Washington Criminal II Section of the Antitrust Division and the FBI’s International Corruption Unit are conducting the investigation into bid rigging in the market for pre-release ADRs.  Anyone with information in connection with this investigation is urged to call the Antitrust Division’s Washington Criminal II Section at 202-598-4000 or visit

Updated May 10, 2019

Press Release Number: 19-509