Sim Tshabalala
Sim Tshabalala
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File image
Image: Twitter: Standard Bank CEO: Sim Tshabalala.
Image: Twitter: Standard Bank CEO: Sim Tshabalala.

JOHANNESBURG - The competition Tribunal will today hear Standard Bank’s application to have the tribunal compel the Competition Commission to provide it with evidence it has against it in the foreign currency exchange (forex) collusion matter involving more that 16 banks. 

The bank in its founding affidavit deposed with the Tribunal accuses the commission of conducting the investigation in a clandestine manner and causing harm to its reputation. 

Jean Meijer, representing Standard Bank, in the affidavit said the commission never engaged the bank during its investigation. 

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“Extraordinarily, Standard Bank became aware of the fact it was alleged to be involved in the subject of forex through the commission’s press release.

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“Standard Bank, as a party that had not been informed that the commission was investigating it, was not provided the courtesy even of access to the referral affidavit before a media release containing damaging allegations was sent out by the commission,” charged Meijer.

Earlier the commission referred 18 banks, including Standard Bank, Investec and Barclays Africa, to the tribunal for prosecution for colluding in forex trading. The commission is seeking 10percent annual turnover fine for the banks. Complex schemes In its founding affidavit the commission said that from at least 2007 to at least 2013, the implicated banks devised complex schemes to short-change clients.

The commission’s complaint is anchored around five areas: 

  1. The banks allegedly agreed to fix trade and offers on trading platforms by engaging in collusive posting of fictitious bids and offers in the Reuters trading platform and dealers owned platforms to manipulate prices.
  2. They co-ordinated trading activities around the fix, with some traders informing each other how much they needed to sell at a fix to assess their risk exposure and assisting each other in minimising such risk.
  3. They agreed to fix prices of bids and offers quoted to customers by agreeing on price to quote customers.
  4. They also agreed to fix bid-offer spreads by consenting on the size of bid-offer spreads to charge customers for a certain volume of currency exchange.
  5. They agreed to co-ordinate trading by assisting each other through manipulating the price of bids and offers through agreements to refrain from trading at particular times.

The commission said currency trading involving the US dollar and rand currency pair accounts for $51 billion of the global daily trades in the market valued at $5 trillion a day.
Sim Tshabalala, who has recently been given the sole responsibiity to run Standard Bank, after releasing the group’s financial results earlier this year was adamant the bank had not been found wanting. 

Image: Twitter: Standard Bank CEO: Sim Tshabalala.

“We’ve trawled chat rooms, phone calls; we’ve gone through thousands of records and have not come across any (collusion). (The traders) have been very clear that they are not guilty of any form of collusion,” Tshabalala said at the time.

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However, Standard Banks stance is in contrast with that of some of its peers, Barclays Africa, and Citibank, who have admitted guilt to the charges, and committed to co-operate
with the commission in the prosecution of the other banks.

The commission preferred to not fine Barclay’s after it admitted built, but fined Citibank nearly R70 million for its role in the matter.

Meijer said there could be debate that the commission had reasonable time to prepare its record since the forex referral was done and the bank’s first request for access to evidence against it. The other implicated banks elected not to force the commission to provide them with evidence it had against them.