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South African Court Clears Most Banks in Rand-Fixing Case

 |  January 9, 2024

South Africa’s Competition Appeal Court has dismissed the cases against the majority of the 28 banks accused of colluding to fix the rand in the New York foreign exchange market almost a decade ago. The ruling, reported by Business Day, comes as a relief for several South African lenders, including Standard Bank Group Ltd., Nedbank Group Ltd., and FirstRand Ltd., as well as most of the foreign banks implicated in the case.

According to the report by Bloomberg, the court’s decision leaves JPMorgan Chase & Co., BNP Paribas SA, HSBC Holdings Plc, Credit Suisse Group AG, and Investec Plc as the remaining banks set to face trial. The Johannesburg-based newspaper revealed that the court criticized the case presented by the Competition Commission, stating it was inadequate and lacked evidence. However, the court made no order regarding costs associated with the proceedings.

The currency-manipulation saga dates back to May 2015 when the Competition Commission alleged that the accused banks colluded to manipulate the value of the rand against the dollar. This inquiry was initiated in the aftermath of a global investigation into currency manipulation, which surfaced two years earlier. The global probe triggered investigations in the United States and the United Kingdom, resulting in billions of dollars in settlements.

In 2020, South Africa’s antitrust watchdog revived the case against the banks, compiling a charge sheet against over 20 lenders accused of colluding to fix prices and divide markets in the currency pair. Despite the revival, the recent ruling by the Competition Appeal Court highlights the challenges faced by the prosecution in substantiating the allegations against the majority of the banks involved.

Source: BNN Bloomberg