Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Deutsche Bank, HSBC And Bank Of Nova Scotia Accused Of Messing With Silver Prices

CommoditiesJul 27, 2014 12:30PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

By Angelo Young - Three banks abused their power to manipulate the daily benchmark price for silver, violating U.S. antitrust laws and rules established by the Commodity Exchange Act, according to a lawsuit filed in Manhattan on behalf of traders.

The accusations come as banks have fallen under increased scrutiny since the summer of 2012 when they were found to be manipulating the daily London Interbank Offered Rate, or Libor, which affects the cost of borrowing worldwide, from business borrowing to car and home loans.

A complaint filed in a federal court in Manhattan Friday alleges London’s HSBC Holdings Plc (LONDON:HSBA), Frankfurt’s Deutsche Bank (XETRA:DBKGn) and Toronto-based Bank of Nova Scotia (TO:BNS) established, “positions in both physical silver and silver derivatives prior to the public release of silver fixing results, allowing them to reap large illegitimate profits.”

HSBC and Deutsche Bank are the world’s second- and third-largest banks by the value of the assets they own.

Earlier this year Barclays (LONDON:BARC), the world’s 10th-largest bank, was fined $45 million by Britain's Financial Conduct Authority after a trader at the bank admitted to manipulating the daily spot price for gold in 2012. Like the accusations made public Friday, critics argued the way the gold benchmark price is set is antiquated and ripe for abuse because the figure is established in secrecy among the world’s largest financial institutions.

"Prices should be determined by market forces of supply and demand and not due to a bank's determination,” Mark O'Byrne, research director at broker GoldCore, told AFP earlier this month.

Friday’s lawsuit filed by J. Scott Nicholson, a resident of Washington state, seeks class-action status representing precious-metal traders against the three banks that set the daily silver benchmark price. The current system of setting the silver prices is more than a century old.

The scrutiny into how banks set the base price of gold and silver has caused some to back out of the process. Earlier this year, Deutsche Bank said it would stop participating in the setting of metals benchmarks.

Deutsche Bank, HSBC And Bank Of Nova Scotia Accused Of Messing With Silver Prices
 

Related Articles

Oil Gains for 2nd Week, But Prices Range-Bound Again
Oil Gains for 2nd Week, But Prices Range-Bound Again By Investing.com - May 07, 2021 3

By Barani Krishnan  Investing.com - Oil put in a second week of gains as crude prices reentered range-bound trading on Friday on concerns about slowing U.S. jobs growth and the...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email