A little background:

First, in the FX market it's quite common to make trades "at the close", ie, the price at a specific time. In principle this serves everyone's interests, because you need to agree to some price, and "the price it happens to be at 4pm" makes about as much sense as anything, and it means that customers can easily check to see what the price was at that time, confirm they paid it, and feel good that, while they may not have got the best price going that day, at least they got the "standard" price.

(It might be tempting to tell your bank you want the "best price that day", but obviously, you only know what that price is after the fact. You could hire the bank's traders to take a wild stab at guessing when it might be, but people who can reliably predict the FX markets are too busy sunning themselves on their yacht made out of gold plated diamonds. Better to just take the price at the close.)

Second, the bank, having agreed to sell your pile of GBP for USD (or whatever) for whatever the price at the close is now have some risk. They've got to go and buy all that USD, and then once they swap it with you for your GBP, they have to then go sell it for USD, so they can sell that and get back to where they started. And what if the price crashes in the meantime? So as is proper (not to mention generally legally required), banks hedge that risk, by, eg, selling GBP and buying USD in the run up to the close, to make sure they're covered if prices move against them.

(Hey, doesn't all that hedging actually make GBP cheaper and USD more expensive? Meaning you'll get less USD for your GBP at the close? Why yes, it does. If you tell your bank to sell £50m for you for whatever the price is at 4pm, you would expect to see them busily driving the price down in the runup to 4pm. That'd just good hedging, and it's perfectly legal.)

Third: What's not legal is making a chatroom called "The Mafia" with traders from other banks, sharing client information, and talking about "taking out the filth" or "front running". Again, it's fine if it's just within your own bank, and you properly disclose it in your fine print, and you don't call your customers names; the issue here is more of branding that substance. There's nothing wrong with knowing an insurance company is about to sell you £50m, which means you'll be selling £50m so you frantically run around selling it in adance...as long as you can plausibly claim to be doing it hedge your trading risks. If you're doing it a chat room called "trading risk compliance committee", that might be plausible. If you're doing in a chat room called "The Mafia", even your lawyer will struggle to keep a straight face.

Fourth: The banks in question already got sued and had to settle for $2.3b in penalties; it was in discovery that all the colourful chat room names came out. So it's not in question whether this happened; it did. Nor has any new information came out (the stuff about the chat rooms came out years ago at this point); this is just the residual lawsuits from the people who opted out of the first one.

In short: This is interesting primarily in a horrified "I can't believe these idiots said this stuff where it was being recorded" sort of way, not because what was going on was actually that bad. It's not even clear that the traders in question actually made money from it, or that any actual customers were harmed. But it seems clear they intended to make money and harm customers (on purpose, that is, because again, you're allowed, and in fact, strongly encouraged, to hedge your trading risks, including the risk that your going to lose a pile of money from your agreement to sell a bunch of GBP on behalf of a client this afternoon, and the way you hedge that risk is to sell it now.), so...billions in fines. Good job guys.