In a landmark development, Standard Chartered Bank (SCB) has conceded to engaging in the manipulation of the rand, joining a list of 17 other banks accused of unethical conduct. On Wednesday, SCB agreed to pay a penalty of R42.7 million to the Competition Commission, admitting liability for conspiring to rig trades involving the US dollar-rand currency pair.
The settlement marks a crucial victory for South Africa, emphasizing the nation’s commitment to holding financial institutions accountable for manipulative practices. This resolution comes amidst ongoing legal proceedings, with banks seeking to challenge the Competition Tribunal’s order. The timing of SCB’s admission strengthens the commission’s stance and signals progress in the eight-year-long litigation over currency manipulation allegations.
The currency manipulation case involving SCB is part of a broader investigation initiated by the commission in 2015, targeting 28 banks manipulating the USD/ZAR currency pair. This settlement follows a similar case involving Citibank N.A in 2017.
Competition Commissioner Doris Tshepe expressed satisfaction with SCB’s decision to settle and encouraged other respondent banks to follow suit. The settlement underscores the commission’s dedication to addressing allegations related to the manipulation of the USD/ZAR currency pair and its impact on the South African Rand’s value.
It is worth noting that SCB had previously settled similar charges with US authorities in 2019, admitting to currency manipulation and paying a fine of $40 million. This admission played a significant role in the commission’s case, reinforcing the difficulty for the bank to contest manipulation charges after acknowledging wrongdoing in another jurisdiction.
Advocate Tembeka Ngcukaitobi, representing the commission, emphasized the complicity of all banks involved in manipulating the rand, using a shared chatroom for their scheme. The acknowledgment by SCB adds weight to the collective culpability of the banks, further affirming the gravity of the allegations.
As SCB’s settlement agreement awaits confirmation by the tribunal, this development marks a pivotal moment in South Africa’s pursuit of justice against currency manipulation practices by financial institutions. The ongoing legal proceedings are set to unfold before the Competition Appeal Court, providing a platform for a comprehensive examination of the allegations against the respondent banks.
