Multinational Standard Chartered Bank admits liability to currency manipulation case, agrees to pay R42m fine
16 Nov 2023
The Competition Commission (Commission) has reached a settlement agreement with UK-based multinational bank, Standard Chartered Bank (“SCB”). In terms of the settlement agreement, SCB admits liability to the manipulation of USD/ZAR currency pair, and agreed to pay an administrative penalty of R42,715,880 (forty-two million, seven hundred and fifteen thousand, eight hundred and eighty Rand).
SCB participated in the manipulation of USD/ZAR currency pair by fixing bids; offers; bid-offer spreads; the spot exchange rate; and the exchange rate at the FIX. Further, SCB participated in dividing markets by allocating customers in terms of which one trader withholds or pulls his/her existing bid or offer from the market to allow the other trader to execute and complete his/her trade. This conduct contravenes section 4(1)(b) (i) & (ii) of the Competition Act, 89 of 1998, as amended.
The settlement comes at a time when respondent banks are currently appearing before the Competition Appeal Court (“CAC”) seeking an order to set aside a Competition Tribunal (“Tribunal”) order of 30 March 2023 which ordered respondent banks to file their answers to the complaint referral. The hearing for the appeals and reviews before the CAC is set down from 13 to 16 November 2023.
SCB is one of the 28 banks that are prosecuted by the Commission for manipulating the USD/ZAR currency pair. This settlement ends an eight-year-long litigation between the Commission and SCB over the currency manipulation allegations. Citibank N.A already settled the same conduct with the Commission in 2017.
The SCB settlement agreement has been filed with the Tribunal for confirmation, which was set down for hearing on 15 November 2023.
“The Commission welcomes SCB’s decision to reach a settlement on this matter and encourages other respondent banks to consider settling the complaint against them. Further, this settlement affirms the Commission’s pursuit of allegations related to the manipulation of the USD/ZAR currency pair, given the ultimate impact of the currency manipulation on the value of the South African Rand,” said Competition Commissioner Doris Tshepe.
Article sourced from The Competition Commission South Africa.
See also:
- Commission welcomes Tribunal ruling ordering banks to answer the allegations against them in the Forex Cartel case
- Parliament gives green light to Financial Sector Laws Bill
- Navigating the fintech regulatory landscape
- The new price discrimination provisions
