Dec 1 (Reuters) - The U.S. Justice Department is not planning any penalties on a civil probe relating to allegations that large banks tried preventing competition in the credit default swaps market, the Wall Street Journal reported, citing people familiar with the matter.
The Justice Department pored over trading data, messages, emails and documents about credit default swaps (CDS) as part of the probe for the past four years, which is drawing to a close, the people told the paper.
The probe focused on trading among a small number of CDS traders who conducted most of their business over the phone rather than via computer technology that records and distributes prices, the Journal said. ()
However, investigators believe the alleged anti-competitive conduct has since been remedied and there is no need to seek penalties.
CDS are over-the-counter contracts that bet on whether a company or country will default on its bonds within a fixed period of time.
The Justice Department probe remains open, with investigators evaluating whether new regulations are opening the market to more competitive trading, and examining trading in the much smaller market for credit futures, the WSJ said.
The Justice Department could not immediately be reached for comment by Reuters outside of regular U.S. business hours.