Three of South Africa’s biggest banks — Standard Bank‚ Absa and Investec — and 14 international banks have been referred to the competition tribunal for price fixing.
They are accused by the Competition Commission of manipulating the price of the rand when selling and buying dollars- through making fictitious orders to buy and sell rand to change supply of the currency.
They also accused of using trading chat rooms to co-ordinate times for the sale of rand or stop selling for a time in order to manipulate prices from 2007.
“This is a big deal‚” said market commentator and trader Simon Brown
He said it was a major announcement because “our Competition Commission are good at what they do“.
When it comes to price fixing‚ “they are not often wrong on everything from bread to bicycles“.
He also said the rand affected the petrol price and this is also why accusations of manipulating currency have implications and huge interest for South Africans.
The commission said in a press release on Wednesday afternoon that it was “seeking an order from the Tribunal declaring that the respondents have contravened the Competition Act“.
It is “seeking an order declaring that the Bank of America Merrill Lynch International Limited‚ BNP Paribas‚ JP Morgan Chase & Co‚ JP Morgan Chase Bank N.A‚ Investec Ltd‚ Standard New York Securities Inc.‚ HSBC Bank Plc‚ Standard Chartered Bank‚ Credit Suisse Group; Standard Bank of South Africa Ltd‚ Commerzbank AG; Australia and New Zealand Banking Group Limited‚ Nomura International Plc.‚ Macquarie Bank Limited are liable for the payment of an administrative penalty equal to 10% of their annual turnover“.
Brown said‚ “that list of banks involved is so long‚ one almost asks‚ ‘who is not the list?’“
He said that banking scandals had become common globally. “We have seen so many of them‚ with accusations of banks manipulating the gold price and LIBOR rates in Britain. There is a lot of dodgy stuff.”
Banks never admit they were wrong but pay large non-admission of guilt fines‚ said Brown.
The three local banks: Absa‚ Standard Bank and Investec share prices barely moved after the announcement.
Brown said this may be partly as the investigation by the tribunal would take a long time.
“I am expecting a Twitter storm. The banks are under huge pressure in South Africa.”
Most foreign banks had local financial assets and offices that could be attached if they were eventually fined making it not so easy to ignore local competition authorities. -TMG Digital
UPDATE: Standard Bank‚ Absa‚ Investec face prosecution‚ huge fines over price fixing allegations
Three of South Africa’s biggest banks — Standard Bank‚ Absa and Investec — and 14 international banks have been referred to the competition tribunal for price fixing.
They are accused by the Competition Commission of manipulating the price of the rand when selling and buying dollars- through making fictitious orders to buy and sell rand to change supply of the currency.
They also accused of using trading chat rooms to co-ordinate times for the sale of rand or stop selling for a time in order to manipulate prices from 2007.
“This is a big deal‚” said market commentator and trader Simon Brown
He said it was a major announcement because “our Competition Commission are good at what they do“.
When it comes to price fixing‚ “they are not often wrong on everything from bread to bicycles“.
He also said the rand affected the petrol price and this is also why accusations of manipulating currency have implications and huge interest for South Africans.
The commission said in a press release on Wednesday afternoon that it was “seeking an order from the Tribunal declaring that the respondents have contravened the Competition Act“.
It is “seeking an order declaring that the Bank of America Merrill Lynch International Limited‚ BNP Paribas‚ JP Morgan Chase & Co‚ JP Morgan Chase Bank N.A‚ Investec Ltd‚ Standard New York Securities Inc.‚ HSBC Bank Plc‚ Standard Chartered Bank‚ Credit Suisse Group; Standard Bank of South Africa Ltd‚ Commerzbank AG; Australia and New Zealand Banking Group Limited‚ Nomura International Plc.‚ Macquarie Bank Limited are liable for the payment of an administrative penalty equal to 10% of their annual turnover“.
Brown said‚ “that list of banks involved is so long‚ one almost asks‚ ‘who is not the list?’“
He said that banking scandals had become common globally. “We have seen so many of them‚ with accusations of banks manipulating the gold price and LIBOR rates in Britain. There is a lot of dodgy stuff.”
Banks never admit they were wrong but pay large non-admission of guilt fines‚ said Brown.
The three local banks: Absa‚ Standard Bank and Investec share prices barely moved after the announcement.
Brown said this may be partly as the investigation by the tribunal would take a long time.
“I am expecting a Twitter storm. The banks are under huge pressure in South Africa.”
Most foreign banks had local financial assets and offices that could be attached if they were eventually fined making it not so easy to ignore local competition authorities. -TMG Digital
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