Reserve Bank wants accountability in rand-rigging scandal

The central bank wants commercial lenders involved in the currency-rigging scandal to be held accountable.

FILE: Picture: EWN.

JOHANNESBURG - South Africa’s central bank wants commercial lenders involved in the rand currency rigging scandal to be held accountable, deputy governor Daniel Mminele said on Friday.

The Competition Commission said last week that it had found more than a dozen local and foreign banks had colluded to coordinate trading in the rand and the US dollar using an instant chat room called “ZAR Domination”.

The central bank saw the allegations in a serious light, Mminele said in a speech posted on the bank’s website.

“The South African Reserve Bank is of the view that those found to have violated the law should accept full responsibility for their actions and be held accountable, and corrective measures should be implemented,” Mminele said.

He said a resolution of the matter, without undue delay or prolonged uncertainty, was in the interests of South Africa’s financial markets and the banking system.

“It is also important, however, that we do not jump to conclusions and allow the steps now initiated to be completed following due process,” Mminele said.

The Commission began its investigation in April 2015, joining an international probe into the manipulation of foreign exchange rates that has led to big banks paying more than $10 billion in settlements.

Barclays Africa, a regional unit of Britain’s Barclays Plc, has already been granted conditional immunity from prosecution in return for supplying information that would lead to the successful prosecution of the other cartel members.

Local lender Standard Bank, which is also among the banks named in the investigation, said on Thursday it is in talks with the watchdog.

The local arm of Citigroup agreed to pay a reduced $5 million penalty for cooperating in the investigation while Investec has said it will seek further information from the regulator to continue to co-operate.

The other banks and brokerages named in the case were Citigroup, Nomura, JP Morgan, BNP Paribas, Credit Suisse Group, Commerzbank AG, Standard New York Securities Inc, Macquarie Bank, Bank of America Merrill Lynch (BAML), ANZ Banking Group Ltd and Standard Chartered Plc.