Bankers must learn collusion serves nobody’s best interests
Antitrust cases pile up against banks worldwide over manipulation of foreign exchange rates
It has been 17 years since Boiler Room, and bankers have decided that the only lesson from "pump and dump" trading is that cold-calling investors is an inferior strategy to colluding in online chatrooms. Unfortunately for them, anticompetitive corporate conduct serves neither the interests of a free market nor government mandates. Throw in manipulation of currency exchange rates and you’re short any legs to stand on, especially when you’re short-changing individuals and institutional investors such as unit trusts and pension funds. Competition authorities globally have, therefore, turned their attention to the financial sector, particularly securities and foreign exchange markets. In SA, the Competition Commission’s investigation into forex manipulation at 17 global and local banks mirrors ongoing and closed cases in the US, Europe and Asia. The facts are virtually identical across these cases: colluding in online chatrooms to artificially widen bid/ask spreads for currency pairs su...
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