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Citibank Agrees To Settle South African Price Rigging Case

Citibank has announced that it has entered into an agreement with South Africa’s regulatory body, the Competition Commission to settle charges of foreign exchange rigging. Its consumer banking arm has agreed to pay R69.5 million (approximately $5.3 million) for its participation in collusion between top banks that lasted a number of years which fixed the price of the rand.

The global banking giant is among the 17 banks that have been identified as having manipulated prices through illegal agreements on bids and offers. The Competition Commission found the banks guilty after a two-year investigation and recommended that the banks be fined 10 percent of their gross revenue.

Announcing the settlement, the Competition Commission said that since Citibank had cooperated with the investigators in the probe and provided witnesses proving the collusion, the fine was lesser than the mandated 10 percent fine.


In a statement Megs Naidu, a spokesman for Citi said,

Citi is pleased that the matter has been settled. We will continue building upon the changes that we have already made to our systems, controls and monitoring processes. Fostering a culture of ethical behavior has been, and continues to be, a top priority for Citi

Competition commissioner Tembinkosi Bonakele said that the settlement was undertaken to speed up the case and strengthen evidence against other accused entities. Citibank is the first bank to have entered into an agreement with the South African authorities. Other banks are expected to follow.

This is however the fourth time that the Citibank group has been indicted for price rigging. In 2014, the bank had to pay a fine of $310 million after being found guilty of price rigging by the US Commodity Futures Trading Commission. In 2015, it paid a $925 million fine to the U.S. Department of Justice (DoJ) for settling charges of conspiring to rig currency bids involving U.S. dollars and Euros among other currencies worldwide.

The Competition Commission said that it had initiated an investigation into 11 banking firms the day the U.S. DoJ settlement was announced.

In the South African case, a trader from Citibank, Christopher Cummins was alleged to have agreed with other traders to influence prices though manipulating offers and bids in order to maximize profit or avoid losses. He also was accused of posting false bids and offers on trading platforms and of influencing the bid-offer spread. Cummins pled guilty in January during the U.S. DoJ’s investigation and agreed to co-operate with the authorities.

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