ON THE MONEY
STUART THEOBALD: FSB’s inquiry into rand shorting may uncover politically explosive information
'Contemplate the political effect of discovering that while SA suffers for the president’s follies a select few might have profited'
What if people shorted the rand before the firing of finance minister Pravin Gordhan? If they did it using JSE-listed futures contracts, it would be illegal. And, depending on just who those people were, it would be politically explosive. It would imply that the move on Gordhan that led to SA’s downgrade to junk status, also led to profits for those connected to the president or at least able to access information about his plans. And if the president gave that information to them, then he too is guilty of an offence. The Financial Services Board (FSB) is investigating just such a possibility. Its investigation comes after some unusual trading in the rand/dollar June and December futures contracts in the hours before Gordhan was summoned back from London on that fateful Monday. On that morning, about two hours before the news broke, someone placed a large short rand position in the market. There was also significant trade on the Thursday beforehand. The volumes of trade in listed in...