Swiss Regulator Is Examining Precious-Metals Market

28 Sep 2015 | Author: | No comments yet »

Swiss Regulator Is Examining Precious-Metals Market.

LONDON — Switzerland’s Competition Commission said on Monday that it had begun investigating seven financial institutions, including the Swiss banks UBS and Julius Baer, over potential collusion to manipulate the precious-metals market. Swiss competition authorities said today they were investigating UBS, HSBC, Deutsche Bank and four other banks on suspicion of price fixing in the precious metals market. In a statement, the commission said it was examining whether there was collusion among banks around the bid-ask spread in the trading of gold, silver, platinum and palladium. The Comco competition regulator says the probe that opened Monday also targets Germany’s Deutsche Bank, U.S.-based Morgan Stanley, Japan’s Mitsui, and HSBC and Barclays of Britain. The financial institutions are Barclays, Deutsche Bank, HSBC, Julius Baer, Morgan Stanley and UBS, and the trading house Mitsui & Company Precious Metals, a unit of Mitsui & Company of Japan.

It said it had indications that the banks had “possibly concluded illegal competition defying deals” in the trade of precious metals like gold, silver and platinum. COMCO in particular suspects “possible price fixing deals, especially in connection with ‘Spreads’”, which is the difference between the bid and asking price, it said. Some of the banks under investigation were already hit by massive fines earlier this year after pleading guilty to US charges of conspiring to rig Libor interest rates. As part of a settlement with United States authorities in the foreign currency trading investigation in May, UBS said it would not face a criminal charge over currency misconduct, or from investigations by American authorities into its precious-metals division. UBS at the time agreed to pay $500 million in fines to resolve inquiries into its role in the manipulation of currency markets and benchmark interest rates.

In May, four major banks pleaded guilty to trying to manipulate foreign exchange rates and, with two others, were fined nearly $6 billion in another settlement in a global investigation into the $5 trillion-a-day market.

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