Citigroup Inc (NYSE:C), Nasdaq Stocks company has been fined $5.3 million by the Competition Commission of South Africa for involvement in a foreign currency trading cartel. In a statement last week, the competition commission of South Africa said it had discovered that traders at a number of local and international banks had colluded to coordinate trading in the U.S and South African currencies. The regulator said it had fined the bank 10% below its annual turnover because the bank undertook to cooperate with the commission during inquiry into the mater.
After conclusively settling the matter, Citibank N.A. South Africa said it will be working to improve on its monitoring process and internal systems. A statement from the bank’s management said the bank will be working to build and improve on the changes made in the system so as to instill a culture of ethical behavior in the company’s operation.
The South African Completion Commission had alleged that nearly 2007 traders at the bank as well as its competitors had an agreement to collude on prices for offers, bids and bid-offer spreads relating to currency trading that involve the local rand and the dollar. The regulator accused traders of manipulating price of bids by deliberately refraining from trading and in some cases initiating fictitious bids.
One of the commission’s official said the settlement was effected to encourage expeditious settlement and complete disclosure to beef up evidence for prosecution of other banks linked to the scam
“This settlement was done to encourage speedy settlement and full disclosure to strengthen the evidence for prosecution of the other banks,” said the Commissioner, Tembinkosi Bonakele.
According to credible sources privy to the matter, Citibank and Barclays PLC (ADR) (NYSE:BCS), another top Nasdaq Stocks bank, had separately approached the competition commission with information of alleged rigging at the rand’s exchange rate. Barclays has since confirmed its cooperation with the commission in the matter. The commission is yet to comment on the matter on whether it has settled the matter with Barclays.