(Adds comments from banks, central bank, detail from statement,
By Tiisetso Motsoeneng
JOHANNESBURG Feb 15 South Africa's competition
watchdog has recommended fines against banks including Citigroup
, Nomura and Standard Bank equal to 10
percent of their annual revenues for rigging the rand currency,
it said on Wednesday.
The Competition Commission said it had concluded an
investigation into whether banks colluded to coordinate their
trading activities when giving quotes to customers who were
buying or selling currencies.
It did not say if the fines should relate to the global
revenues of the banks in question or just their South African
business and could not be reached for further comment.
The probe found that from at least 2007, traders at these
banks had an agreement to collude on prices for bids, offers and
bid-offer spreads for spot trades involving the rand and the
U.S. dollar, the Commission said.
"They also created fictitious bids and offers, distorting
demand and supply in order to achieve their profit motives," the
Commission said in a statement.
It did not give any detailed examples of how it had come to
this finding, but said the banks had a general agreement to
collude and had used instant messaging, phone conversation and
meetings to coordinate their activities.
The Commission launched the investigation in April 2015,
joining a global clampdown that has led to dozens of traders
fired and big banks fined around $10 billion in total for
rigging the level of Libor and other forex benchmarks.
The Commission, which investigates anti-trust practices,
said it had referred the case for prosecution to the Competition
Tribunal, which holds hearings on anti-trust matters before
making a finding which parties affected can then appeal to South
Africa's Competition Appeal Court.
"The referral of this matter to the Tribunal marks a key
milestone in this case as it now affords the banks an
opportunity to answer for themselves," said Commissioner
Tembinkosi Bonakele in a statement.
The Tribunal declined comment.
Other banks named in the case were Investec, JP
Morgan, BNP Paribas, Credit Suisse Group
, Commerzbank AG, Standard New York Securities
Inc, Macquarie Bank, Bank of America Merrill Lynch
, ANZ Banking Group Ltd, Standard Chartered Plc
and Barclays Africa (Absa), part of the
"It should be noted that the Competition Commission has not
sought any penalties against Absa," Barclays Africa said without
giving any explanation. It said it would cooperate with the
Investec also said in an emailed statement it would
cooperate, but added: "Unfortunately at this stage we still do
not have further detail with respect to the nature of the
investigation and are thus not able to comment on the matter."
Standard Bank declined to comment.
The South African Reserve Bank (SARB) said it saw the
allegations in a serious light.
"The SARB will allow the legal processes now initiated to
run their course, and will continue to monitor developments
closely to inform any action that we may need to embark upon in
accordance with our mandate and jurisdiction," the central bank
said in a statement.
(Additional reporting by TJ Strydom; Editing by Susan Fenton
and David Holmes)