‘Le­gal en­ti­ties in probe of banks mixed up’

The Star Early Edition - - COMPANIES - Renne Bonorchis, Loni Prinsloo and Stephen Mor­ris

SOUTH African an­titrust in­ves­ti­ga­tors mixed up the le­gal en­ti­ties of some banks named in a cur­rency ma­nip­u­la­tion probe and de­layed hear­ings so they can re­con­sider the case, ac­cord­ing to peo­ple fa­mil­iar with the mat­ter.

At a pre-hear­ing in Pre­to­ria last week, the Com­pe­ti­tion Com­mis­sion’s lawyers in­di­cated that some com­plaints may be ap­plied to new le­gal en­ti­ties, the peo­ple said, ask­ing not to be iden­ti­fied be­cause the meet­ing was pri­vate. More hear­ings sched­uled to start next month have been de­layed and the com­mis­sion may have to de­vise a new strat­egy that could see it charge lenders in­di­vid­u­ally rather than as a group, one of the peo­ple said.

The com­mis­sion in Fe­bru­ary al­leged that 14 bank­ing en­ti­ties col­luded to ma­nip­u­late the value of the rand. In fil­ings in May, HSBC Bank and In­vestec said the com­mis­sion named the wrong le­gal en­ti­ties. Stan­dard Bank’s South African unit, Bank of Amer­ica Mer­rill Lynch In­ter­na­tional and Stan­dard New York Se­cu­ri­ties all said the traders the com­mis­sion ac­cused of ma­nip­u­la­tion on their be­half had ei­ther never worked for them or never traded the rand.

Stan­dard Bank’s gen­eral coun­sel, Ian Sin­ton, said on Tues­day that the an­titrust reg­u­la­tor’s lawyers in­di­cated at the hear­ings that the com­mis­sion would re­voke its com­plaint against some lenders and may ac­cuse oth­ers. Sin­ton said rep­re­sen­ta­tives of the ac­cused banks and the com­mis­sion had agreed to can­cel for­mal hear­ings so that the reg­u­la­tor could have time to amend its com­plaint.

How­ever, com­pe­ti­tion com­mis­sioner Them­binkosi Bon­akele later said Stan­dard Bank mis­un­der­stood what hap­pened at the closed hear­ing.

It’s an er­ror “There’s no truth at all that we may with­draw any al­le­ga­tions against any banks,” Bon­akele said. “It’s an er­ror. It doesn’t mean we’ll never press any new charges against any other banks.”

Some lenders said in the pa­pers filed in May that South Africa’s an­titrust author­ity has no ju­ris­dic­tion, be­cause there is no ev­i­dence the trades hap­pened in­side the coun­try or had any ef­fect on the econ­omy.

The com­mis­sion was asked by the Com­pe­ti­tion Tri­bunal and lenders to make a clearer ar­gu­ment about its abil­ity to tar­get non-South African en­ti­ties, the peo­ple said.

The com­mis­sion ar­gued that be­cause trades were made in the rand, it would have im­pacted the coun­try, ac­cord­ing to one of the peo­ple.

JPMor­gan Chase, Credit Suisse Group, HSBC Hold­ings, No­mura In­ter­na­tional and Com­merzbank de­clined to com­ment.

PHOTO: BLOOMBERG

Rand ban­knotes ar­ranged for dis­play in this file photo. The Com­pe­ti­tion Com­mis­sion al­leges that 14 bank­ing en­ti­ties have col­luded to ma­nip­u­late the value of the rand.

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.