Three remittances firms have been fined by the Financial Conduct Authority (FCA) over unfair competition practices.
The companies named are Dollar East Ltd., Hafiz Bros Travel & Money Transfer Limited, and LCC Trans-Sending Limited (daughter company of Small World), for a combined penalty fee of more than £150,000.
According to the FCA, the three businesses broke competition laws by fixing prices charged to consumers in Glasgow, coordinating certain exchange rates between February and May 2017 for converting UK pounds to Pakistan Rupees.
Sheldon Mills, Executive Director of Consumers and Competition at the FCA, said: “Money transfer businesses are an important service relied upon by many communities up and down the country.
“We saw evidence of these businesses operating as a cartel, working together to fix their prices and exchange rates on money transfers.
“This behaviour can lead to customers being ripped off, and it erodes public trust. We take this extremely seriously and will use our competition powers to protect consumers across the UK.”
Because all three firms have admitted the wrongdoing, the FCA has issued settlement discounts to reflect this.
The conduct is in direct breach of the Competition Act 1998 that prohibits agreements and practices that may damage competition in the UK. In this case, the coordination only related to the firms’ physical branch services, with their online operations remaining unaffected.
“The FCA has also taken separate action to warn a number of other money transfer firms based in Glasgow about the importance of ensuring that they comply with competition law,” the regulator further noted.