People walk past the head office of Standard Chartered bank in the City of London. Photo Reuters
People walk past the head office of Standard Chartered bank in the City of London. Photo Reuters

Standard Chartered throws other banks under the bus

Rand rigging
The UK-headquartered lender distorted bids, offers, bid-offer spreads and participated in dividing markets by allocating customers among banking peers in contravention of the Competition Act.
Garth Theunissen - Standard Chartered will provide evidence against other banks implicated in manipulating the rand exchange rate, as part of a settlement with competition authorities to avoid further prosecution beyond the R42.7 million administrative penalty it agreed to pay for its role in the forex rigging saga.

The settlement ends eight years of litigation between the British multinational bank and South African competition authorities, though it may have serious implications for other lenders charged with being part of an overarching conspiracy to manipulate the rand.

The settlement was confirmed as an order of the Competition Tribunal following a hearing on Wednesday afternoon during which the authority sought clarity on various clauses contained in the agreement with Standard Chartered.

"Standard Chartered has undertaken to cooperate in the prosecution of the other respondent banks," Makgale Mohlala, head of the cartels division at the Competition Commission, said during the tribunal hearing on Wednesday afternoon.

The tribunal later issued a statement saying Standard Chartered had agreed to provide evidence, written or otherwise, that is in its possession or under its control, which will assist in the prosecution of the remaining respondent banks in the forex rigging matter.



Settlement

As part of its settlement with competition authorities, Standard Chartered pledged to refrain from engaging in anti-competitive behaviour or any prohibited practice in the future.

It must also prepare and circulate a statement summarising the contents of the settlement agreement to its employees, managers and directors who have market-making responsibilities within 30 days of the agreement being confirmed, as an order of the Tribunal.

Hearings into the involvement of the other accused banks are being heard separately this week at the Competition Appeal Court (CAC) under the auspices of Judge Dennis Davis.

During those proceedings, legal representatives from respondent banks questioned the merits of the case against them, and queried whether local authorities have jurisdiction, given that much of the forex trading that impacts the rand takes place offshore.

Standard Chartered's settlement with competition authorities was premised on it admitting liability in distorting bids, offers, bid-offer spreads as well as other activities aimed at manipulating the rand-dollar exchange rate between 2007 and 2013.

It also participated in dividing markets by allocating customers in terms of which one trader withholds or pulls an existing bid or offer from the market to allow another trader to execute and complete a separate trade.



Cartel

Though competition authorities said this cartel activity appeared to end in 2013, when the last of the implicated Standard Chartered traders left its employ, action against 28 local and international banks initially implicated first occurred about two years later.

The Competition Commission first lodged a complaint in April 2015 against various financial entities, including Barclays Bank, Barclays Africa Group, BNP Paribas, BNP Paribas South Africa, Citigroup, Citigroup Global Markets, JP Morgan Chase & Co, JP Morgan South Africa, Investec, Standard New York Securities and Standard Chartered Bank.

This complaint centred on allegations that the companies had been involved in a concerted effort to manipulate the rand exchange rate in violation of the Competition Act. Much of the alleged collusion is said to have occurred over instant messaging platforms on terminals leased from Bloomberg and Reuters, financial data providers that also supply live news feeds and trading systems.

In August 2016, the Competition Commission amended the complaint to add ABSA, Barclays Capital, Credit Suisse Group, Commerzbank, Bank of America Merrill Lynch, HSBC Bank, ANZ, Citibank, JP Morgan, Nomura International, Macquarie Group, and JP Morgan Chase Bank.

The amendment included allegations of market allocation, an anti-competitive practice that involves dividing up customers among participants, as well as claims the respondent banks had assisted each other by allowing a trader with a significant open risk position to complete trades before others and by manipulating market liquidity.



Citibank

On 15 February 2017, the Competition Commission referred the matter to the Competition Tribunal for adjudication.

Though Citibank settled with the Competition Commission over similar allegations in April 2017, due to various legal challenges against competition authorities from other respondents, the matter has ended up in the CAC, where proceedings are ongoing.

Citibank’s involvement in manipulating the rand occurred between September 2007 and October 2013, resulting in an administrative penalty of more than R69.5 million.

US-based Citibank also agreed to fully cooperate with local competition authorities in the prosecution of the forex rigging matter. - Fin24

Comments

Namibian Sun 2023-12-02

No comments have been left on this article

Please login to leave a comment

Premier League: Forest 0 vs 1 Everton | Burnley 5 vs 0 Sheffield United | Brentford 3 vs 1 Luton Town LaLiga: Real Madrid 2 vs 0 Granada | Athletic Club 4 vs 0 Rayo Vallecano | Girona 2 vs 1 Valencia | Las Palmas 2 vs 0 Getafe | Mallorca 1 vs 1 Cadiz SerieA: SS Lazio 1 vs 0 Cagliari | Genoa 1 vs 1 Empoli | Monza 1 vs 2 Juventus European Championships Qualifying: Swansea City 1 vs 1 Huddersfield Town | Southampton 2 vs 0 Cardiff City | Plymouth Argyle 2 vs 1 Stoke City | Millwall FC 1 vs 1 Sunderland | Sheffield Wednesday 3 vs 1 Blackburn Rovers | Hull City 1 vs 2 Watford | Leeds United 3 vs 2 Middlesbrough | Ipswich Town 2 vs 1 Coventry City | Birmingham City 0 vs 0 Rotherham United | West Bromwich Albion 1 vs 2 Leicester City | Preston North End 0 vs 2 Queens Park Rangers | Ipswich Town 3 vs 1 Millwall FC | Sunderland 1 vs 2 Huddersfield Town | Southampton 1 vs 0 Bristol City | Blackburn Rovers 4 vs 2 Birmingham City | Sheffield Wednesday 1 vs 1 Leicester City | Leeds United 3 vs 1 Swansea City English Championship: Swansea City 1 vs 1 Huddersfield Town | Southampton 2 vs 0 Cardiff City | Plymouth Argyle 2 vs 1 Stoke City | Millwall FC 1 vs 1 Sunderland | Sheffield Wednesday 3 vs 1 Blackburn Rovers | Hull City 1 vs 2 Watford | Leeds United 3 vs 2 Middlesbrough | Ipswich Town 2 vs 1 Coventry City | Birmingham City 0 vs 0 Rotherham United | West Bromwich Albion 1 vs 2 Leicester City | Preston North End 0 vs 2 Queens Park Rangers | Ipswich Town 3 vs 1 Millwall FC | Sunderland 1 vs 2 Huddersfield Town | Southampton 1 vs 0 Bristol City | Blackburn Rovers 4 vs 2 Birmingham City | Sheffield Wednesday 1 vs 1 Leicester City | Leeds United 3 vs 1 Swansea City Katima Mulilo: 22° | 38° Rundu: 21° | 36° Eenhana: 21° | 32° Oshakati: 24° | 30° Ruacana: 20° | 31° Tsumeb: 22° | 33° Otjiwarongo: 18° | 30° Omaruru: 22° | 32° Windhoek: 19° | 28° Gobabis: 21° | 32° Henties Bay: 16° | 20° Wind speed: 20km/h, Wind direction: S, Low tide: 12:19, High tide: 06:27, Low Tide: 00:26, High tide: 18:32 Swakopmund: 16° | 18° Wind speed: 25km/h, Wind direction: SW, Low tide: 12:17, High tide: 06:25, Low Tide: 00:24, High tide: 18:30 Walvis Bay: 16° | 22° Wind speed: 28km/h, Wind direction: SW, Low tide: 12:17, High tide: 06:24, Low Tide: 00:24, High tide: 18:29 Rehoboth: 20° | 28° Mariental: 23° | 31° Keetmanshoop: 19° | 35° Aranos: 24° | 30° Lüderitz: 17° | 29° Ariamsvlei: 20° | 34° Oranjemund: 14° | 22° Luanda: 26° | 27° Gaborone: 19° | 37° Lubumbashi: 17° | 20° Mbabane: 13° | 30° Maseru: 17° | 33° Antananarivo: 16° | 27° Lilongwe: 19° | 32° Maputo: 19° | 32° Windhoek: 19° | 28° Cape Town: 17° | 22° Durban: 19° | 29° Johannesburg: 20° | 33° Dar es Salaam: 26° | 31° Lusaka: 19° | 33° Harare: 17° | 32° Currency: GBP to NAD 23.62 | EUR to NAD 20.25 | CNY to NAD 2.61 | USD to NAD 18.62 | DZD to NAD 0.14 | AOA to NAD 0.02 | BWP to NAD 1.33 | EGP to NAD 0.59 | KES to NAD 0.12 | NGN to NAD 0.02 | ZMW to NAD 0.77 | ZWL to NAD 0.04 | BRL to NAD 3.81 | RUB to NAD 0.2 | INR to NAD 0.22 | USD to DZD 134.22 | USD to AOA 827.79 | USD to BWP 13.56 | USD to EGP 30.85 | USD to KES 153.08 | USD to NGN 788 | USD to ZAR 18.63 | USD to ZMW 23.82 | USD to ZWL 321 | Stock Exchange: JSE All Share Index 75705.88 Up +0.23% | Namibian Stock Exchange (NSX) Overall Index 1630.14 Up +0.81% | Casablanca Stock Exchange (CSE) MASI 11748.19 Down -0.28% | Egyptian Exchange (EGX) 30 Index 24735.39 Down -0.1% | Botswana Stock Exchange (BSE) DCI 8879.08 Same 0 | NSX: MTC 7.51 SAME | Anirep 8.99 SAME | Capricorn Investment group 17 SAME | FirstRand Namibia Ltd 49 DOWN 2.00% | Letshego Holdings (Namibia) Ltd 3.91 UP 0.30% | Namibia Asset Management Ltd 0.7 SAME | Namibia Breweries Ltd 31.97 SAME | Nictus Holdings - Nam 2.2 SAME | Oryx Properties Ltd 12.48 SAME | Paratus Namibia Holdings 12 SAME | SBN Holdings 8.45 SAME | Trustco Group Holdings Ltd 0.5 SAME | B2Gold Corporation 63.66 UP 0.80% | Local Index closed 675.32 DOWN 0.41% | Overall Index closed 1631.36 UP 2.13% | Osino Resources Corp 17.1 UP 2.52% | Commodities: Gold US$ 2 071.88/OZ UP +1.56% | Copper US$ 3.87/lb UP +1.66% | Zinc US$ 2 537.50/T DOWN -0.3% | Brent Crude Oil US$ 79.29/BBP DOWN -1.58% | Platinum US$ 936.41/OZ UP +0.50% Sport results: Premier League: Forest 0 vs 1 Everton | Burnley 5 vs 0 Sheffield United | Brentford 3 vs 1 Luton Town LaLiga: Real Madrid 2 vs 0 Granada | Athletic Club 4 vs 0 Rayo Vallecano | Girona 2 vs 1 Valencia | Las Palmas 2 vs 0 Getafe | Mallorca 1 vs 1 Cadiz SerieA: SS Lazio 1 vs 0 Cagliari | Genoa 1 vs 1 Empoli | Monza 1 vs 2 Juventus European Championships Qualifying: Swansea City 1 vs 1 Huddersfield Town | Southampton 2 vs 0 Cardiff City | Plymouth Argyle 2 vs 1 Stoke City | Millwall FC 1 vs 1 Sunderland | Sheffield Wednesday 3 vs 1 Blackburn Rovers | Hull City 1 vs 2 Watford | Leeds United 3 vs 2 Middlesbrough | Ipswich Town 2 vs 1 Coventry City | Birmingham City 0 vs 0 Rotherham United | West Bromwich Albion 1 vs 2 Leicester City | Preston North End 0 vs 2 Queens Park Rangers | Ipswich Town 3 vs 1 Millwall FC | Sunderland 1 vs 2 Huddersfield Town | Southampton 1 vs 0 Bristol City | Blackburn Rovers 4 vs 2 Birmingham City | Sheffield Wednesday 1 vs 1 Leicester City | Leeds United 3 vs 1 Swansea City English Championship: Swansea City 1 vs 1 Huddersfield Town | Southampton 2 vs 0 Cardiff City | Plymouth Argyle 2 vs 1 Stoke City | Millwall FC 1 vs 1 Sunderland | Sheffield Wednesday 3 vs 1 Blackburn Rovers | Hull City 1 vs 2 Watford | Leeds United 3 vs 2 Middlesbrough | Ipswich Town 2 vs 1 Coventry City | Birmingham City 0 vs 0 Rotherham United | West Bromwich Albion 1 vs 2 Leicester City | Preston North End 0 vs 2 Queens Park Rangers | Ipswich Town 3 vs 1 Millwall FC | Sunderland 1 vs 2 Huddersfield Town | Southampton 1 vs 0 Bristol City | Blackburn Rovers 4 vs 2 Birmingham City | Sheffield Wednesday 1 vs 1 Leicester City | Leeds United 3 vs 1 Swansea City Weather: Katima Mulilo: 22° | 38° Rundu: 21° | 36° Eenhana: 21° | 32° Oshakati: 24° | 30° Ruacana: 20° | 31° Tsumeb: 22° | 33° Otjiwarongo: 18° | 30° Omaruru: 22° | 32° Windhoek: 19° | 28° Gobabis: 21° | 32° Henties Bay: 16° | 20° Wind speed: 20km/h, Wind direction: S, Low tide: 12:19, High tide: 06:27, Low Tide: 00:26, High tide: 18:32 Swakopmund: 16° | 18° Wind speed: 25km/h, Wind direction: SW, Low tide: 12:17, High tide: 06:25, Low Tide: 00:24, High tide: 18:30 Walvis Bay: 16° | 22° Wind speed: 28km/h, Wind direction: SW, Low tide: 12:17, High tide: 06:24, Low Tide: 00:24, High tide: 18:29 Rehoboth: 20° | 28° Mariental: 23° | 31° Keetmanshoop: 19° | 35° Aranos: 24° | 30° Lüderitz: 17° | 29° Ariamsvlei: 20° | 34° Oranjemund: 14° | 22° Luanda: 26° | 27° Gaborone: 19° | 37° Lubumbashi: 17° | 20° Mbabane: 13° | 30° Maseru: 17° | 33° Antananarivo: 16° | 27° Lilongwe: 19° | 32° Maputo: 19° | 32° Windhoek: 19° | 28° Cape Town: 17° | 22° Durban: 19° | 29° Johannesburg: 20° | 33° Dar es Salaam: 26° | 31° Lusaka: 19° | 33° Harare: 17° | 32° Economic Indicators: Currency: GBP to NAD 23.62 | EUR to NAD 20.25 | CNY to NAD 2.61 | USD to NAD 18.62 | DZD to NAD 0.14 | AOA to NAD 0.02 | BWP to NAD 1.33 | EGP to NAD 0.59 | KES to NAD 0.12 | NGN to NAD 0.02 | ZMW to NAD 0.77 | ZWL to NAD 0.04 | BRL to NAD 3.81 | RUB to NAD 0.2 | INR to NAD 0.22 | USD to DZD 134.22 | USD to AOA 827.79 | USD to BWP 13.56 | USD to EGP 30.85 | USD to KES 153.08 | USD to NGN 788 | USD to ZAR 18.63 | USD to ZMW 23.82 | USD to ZWL 321 | Stock Exchange: JSE All Share Index 75705.88 Up +0.23% | Namibian Stock Exchange (NSX) Overall Index 1630.14 Up +0.81% | Casablanca Stock Exchange (CSE) MASI 11748.19 Down -0.28% | Egyptian Exchange (EGX) 30 Index 24735.39 Down -0.1% | Botswana Stock Exchange (BSE) DCI 8879.08 Same 0 | NSX: MTC 7.51 SAME | Anirep 8.99 SAME | Capricorn Investment group 17 SAME | FirstRand Namibia Ltd 49 DOWN 2.00% | Letshego Holdings (Namibia) Ltd 3.91 UP 0.30% | Namibia Asset Management Ltd 0.7 SAME | Namibia Breweries Ltd 31.97 SAME | Nictus Holdings - Nam 2.2 SAME | Oryx Properties Ltd 12.48 SAME | Paratus Namibia Holdings 12 SAME | SBN Holdings 8.45 SAME | Trustco Group Holdings Ltd 0.5 SAME | B2Gold Corporation 63.66 UP 0.80% | Local Index closed 675.32 DOWN 0.41% | Overall Index closed 1631.36 UP 2.13% | Osino Resources Corp 17.1 UP 2.52% | Commodities: Gold US$ 2 071.88/OZ UP +1.56% | Copper US$ 3.87/lb UP +1.66% | Zinc US$ 2 537.50/T DOWN -0.3% | Brent Crude Oil US$ 79.29/BBP DOWN -1.58% | Platinum US$ 936.41/OZ UP +0.50%