FX market,Risk & Compliance,Risk and Regulation,The Exchanges,Transaction Banking,

FX market,Risk & Compliance,Risk and Regulation,The Exchanges,Transaction Banking,

South Africa will no longer do deals with banks offering to cooperate in a case into alleged rigging of the rand, the head of the Competition Commission said on Wednesday, a blow to some banks that had discreetly approached the watchdog for a settlement.

The Commission concluded an investigation in February into whether banks colluded to coordinate their trading activities when giving quotes to customers who were buying or selling currencies.

It recommended fines amounting to 10 percent of the more than a dozen local and foreign banks’ South African revenues in a scandal that has piled political pressure on local lenders.

“Some banks have approached us discreetly to discuss a settlement. We are no longer interested in those discussions,” Commissioner Tembinkosi Bonakele a news conference.

Bonakele declined to name the banks.

The Commission launched the investigation in April 2015, joining a global clamp down that has led to big banks being fined around $10 billion in total for rigging interest rate and forex benchmarks.

It referred the case to the Competition Tribunal, which adjudicates on anti-trust matters.

So far none of the 17 banks named in the investigation has pleaded to the merits of the case.

Some banks have raised objections about the lack of specific details in the case to allow their lawyers to present a defence while others questioned whether the Commission can prosecute banks with no branches in South Africa.

“This case was referred in February. To date, no bank has answered on the merits of the case. I don’t know if there’s hope that somehow this is going to go away,” Bonakele said. “This may take years. We have the patience for this. What we want is an answer as to what happened to trading desks of these banks.”

The Tribunal appears unlikely to start hearing from banks on the merits of the case until at least early next year after scheduling a Sept. 18 hearing into whether Standard Bank is entitled to full evidence from the Commission against it.

The Commission and the banks would then have to schedule dates for a three-day hearing to deal with whether it has the jurisdiction over some of the lenders, Deputy Commissioner Hardin Ratshisusu said.

Barclays Africa Group, a regional unit of Barclays Plc until three months ago, has been granted immunity from prosecution in return for its cooperation in the investigation while the local arm of Citigroup was handed a reduced fine of $5 million for agreeing to cooperate.

Re-disseminated by The Asian Banker from Reuters