Rand manipulation: Competition Tribunal includes 9 more big banks, rules it can hear case

Rand manipulation: Competition Tribunal includes 9 more big banks, rules it can hear case | Business

The Competition Tribunal has ruled that it has the jurisdiction to hear the long-standing case…

Business

Compiled by Ahmed Areff

The Competition Tribunal has ruled that it has the jurisdiction to hear the long-standing case against foreign and local banks that allegedly colluded to manipulate the rand-dollar exchange rate, and has included nine more banks to the matter.

It said in a statement on Thursday that it granted Competition Commission’s applications to join the nine banks to the case that dates back nearly eight years. They include HSBC Bank USA, Merrill Lynch, Pierce Fenner and Smith, National Association, Bank of America, Credit Suisse Securities (US), Nedbank, FirstRand, as well as Standard Americas.

Nineteen other banks are already included in the case including Absa, Standard Bank, Barclays and Investec.

Several banks had objected to the tribunal hearing the matter on the grounds of lack of jurisdiction, among other issues.

“In addition to its ruling that it has jurisdiction to hear the matter, the tribunal has ordered that all of the banks must respond to the referral by filing their answering affidavits (in the main matter dealing with the merits of the case) within 40 business days of the tribunal’s order,” the tribunal said in a statement.

“If the commission wishes to file replying affidavits, it must do so within 20 business days of the banks’ answering affidavits. The Tribunal’s order effectively provides for the pleading stage of the matter to progress in line with specified time frames before the merits (hearing of evidence) stage.”

The commission is accusing the 28 banks of colluding on forex deals and thus manipulating the foreign exchange market by “fixing” the price of the rand for several seconds and even minutes several times between 2007 and until at least September 2013. It alleged that they were all part of a “single overarching conspiracy” to manipulate the rand.

“The commission maintains that the manipulation impacted on the exchange rate of the South African rand which, in turn, affected various parts of the South African economy including imports and exports; foreign direct investment; public and private debt; company balance sheets, with the attendant implications for the price of goods and services; and financial assets,” the tribunal said.

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