Barriers
Reverse knock-out
Was the barrier good?
Whether a print in the observation window was a good barrier under the confirmation, and what a dealer who had run those books would have treated as the source and the cut.
Independent expert witness · FX and market abuse
Expert evidence in foreign exchange and market abuse.
Options and barriers as a dealing-room specialism. 1LOD and 2LOD market-abuse review in FX, from the trade and order data. For solicitors, counsel and in-house teams in the UK and overseas.
- 1992
- FX derivatives
- Barriers
- A dealing-room specialism
- 1LOD · 2LOD
- Market abuse in FX
- London
- UK and worldwide
Spot · Forwards · Barriers · Options · 1LOD · 2LOD · MAR · Close-out
The practice
The dealing room, in court.
FX Expert Services gives independent expert evidence in foreign exchange and in market abuse. Barriers and options are a dealing-room specialism. 1LOD and 2LOD review is a surveillance specialism: the FX tape, not the alert text. We write so that a judge who has never stood on a desk can follow the trade.
Manuel Mifsud headed EMEA FX derivatives, later ran hedge-fund FX books, and now works as a 1LOD market-abuse analyst after a 2LOD surveillance SME role. He is a member of the Expert Witness Institute. Instructions are taken personally. If the file will not bear the opinion asked, we say so before a report is written.
The expertExpertise
What we are instructed on
01
FX barriers
Knock-outs, knock-ins, reverse KOs, windowed observation, and whether a print was a good barrier.
02
Vanilla and exotic options
Vanillas, digitals, touches, TARFs, collars, and the volatility surface used to close them.
03
Market abuse — 1LOD and 2LOD
Independent review of FX alerts from the trade and order data. 1LOD challenge of 2LOD closures; 2LOD SME on MAR, STORs and the control framework.
04
Spot FX
Last look, internalisation, bid–offer spreads, and whether a fill was consistent with the market of that second.
05
Forwards and FX swaps
Forward points, broken dates, roll costs, and the close-out of a book when a relationship ends.
06
Non-deliverable forwards
Fixing sources, disruption, emerging-market pairs, and what happens when the published rate is not a market.
What the market would have done.
A reverse knock-out, a last-look fill, a 1LOD review of an FX alert: the question is almost always market practice on the day, not a textbook rate. We reconstruct the desk — or the surveillance file — and we say what the data will support.
Case studies
Typical questions
Illustrative of the issues. Not a list of appointments.
1LOD · 2LOD
FX alerts
Independent of the 2LOD write-up?
A 1LOD review of alerts closed by 2LOD. Whether the conclusion follows from the underlying FX orders and trades, or from a narrative that the tape will not bear.
MAR
Orders and trades
Legitimate FX trading, or abuse?
Whether a pattern in an FX book is a genuine strategy — or spoofing, layering, wash trading, ramping or an off-market print — read from the data, not from the alert text.
Spot FX
Last look
Was the fill the market of that second?
A last-look rejection or an internalised fill. Whether it was price-and-credit checking, or holding the order long enough to trade against it.
Authorities
Reported cases
Public judgments, decisions and settlements in FX. Not a list of appointments. Current and former employers appear in some of the files.
2023–25
S.D.N.Y. / 2d Cir.
United States v. Neil Phillips (Glen Point Capital / Morgan Stanley)
155 F.4th 102 (2d Cir. 2025); 690 F. Supp. 3d 268 (S.D.N.Y. 2023)
A one-touch digital barrier option on USD/ZAR, barrier 12.50, sold by Morgan Stanley. Glen Point’s co-CIO convicted of directing some $700 million of spot to touch the barrier and collect a $20 million payout. The Second Circuit affirmed: what a one-touch is, whether the print was a good barrier, and whether chasing it was a market or a fraud.
2022–
S.D.N.Y. (CFTC)
CFTC v. Glen Point Capital Advisors LP
No. 1:22-cv-10589 (S.D.N.Y., filed 15 December 2022)
The civil companion. Two one-touch binary options on USD/ZAR, combined payout $30 million, alleged to have been chased on 25 and 28 December 2017 in thin holiday liquidity. What the confirmation required as a barrier event, whether the print was a market, and the 1LOD/2LOD question of how a dealer records a one-touch that has just paid.
2013
Commercial Court
Deutsche Bank AG v Sebastian Holdings Inc
[2013] EWHC 3463 (Comm)
Close-out of an FX and currency-options book. Cooke J on the market meaning of a vanilla put or call, and whether knock-outs, double knock-outs, digitals and target-profit forwards were currency options or exotic transactions outside the trader’s authority.
2013
Supreme Court of Korea
KIKO knock-in knock-out currency options
2011Da53683 (en banc), 26 September 2013
Knock-in knock-out USD/KRW options sold to Korean exporters. Whether the structure was an unfair contract, whether it was a hedge, and the bank’s duty to explain the knock-in, the knock-out and the unlimited downside.
Instruction
How an instruction runs
- 01
Conflicts
Names of parties, counsel, banks and known related entities — including current and former employers. A conflicts check the same day where we can.
- 02
Scope
The market questions the court actually needs answered — a barrier, a last-look fill, a 1LOD review of an FX alert — and the questions it does not.
- 03
Evidence
Tickets, blotters, confirmations, order and trade data, chat and voice. We say early if the file cannot support the opinion asked.
- 04
Report
A CPR Part 35 (or arbitral equivalent) report: assumptions, method, opinion, and the limits of that opinion. Drafts are for factual correction, not advocacy.
- 05
Oral evidence
Commercial Court, High Court and international arbitration. Evidence in the language of the dealing room and of the 1LOD and 2LOD file.
Forums
Where we give evidence
- Commercial Court
- High Court
- LCIA
- ICC
- SIAC
- FCA matters
- MAR / STORs
- Mediation
Currently accepting instructions.
Solicitors, counsel and in-house teams: send a confidential summary for a conflicts check. UK office hours.