Canadian lawsuit accuses former London gold fix banks of market manipulationon December 23, 2015 at 09:45
8:35p ET Tuesday, December 22, 2015
Dear Good friend of GATA and Gold:
A class-action lawsuit brought in Canada this week accuses the bullion banks that participated in the former daily London gold correct of conspiring to manipulate the gold industry in violation of Canada’s Competition Act and the anti-trust laws of other nations.
Though the bullion banking institutions are almost certainly agents and intimate clients of central banking institutions, the lawsuit helps make no accusations against central banking institutions, most likely simply because gold market place rigging by Western central banks is specifically authorized by law — in the United States by the Gold Reserve Act of 1934, as amended — and probably due to the fact rigging of the gold marketplace by central banking institutions is an officially prohibited topic amongst Western financial information organizations and hence any mention of central banks in the lawsuit would have disqualified the suit from any publicity at all.
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The lawsuit appears to aim totally at the secret communications among the banks participating in the former every day gold value repairing method in London.
The Nationwide Post’s report nowadays about the lawsuit is appended.
The lawsuit’s full complaint as filed in Ontario Superior Court is posted in PDF format at GATA’s Web website right here:
GATA supporter David Caron of Kelowna, British Columbia, is one particular of two lead plaintiffs. Between the traders claimed to have suffered losses as a consequence of the industry manipulation are traders in fiscal instruments managed by GATA’s pals at Sprott Asset Management in Toronto.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Believe in Action Committee Inc.
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Canadian Lawsuit Names Bank of Nova Scotia in Gold Price tag Manipulation
By Barbara Schecter
Nationwide Post, Toronto
Tuesday, December 22, 2015
TORONTO — Financial institution of Nova Scotia, along with a handful of worldwide banks embroiled in a lawsuit in the United States over alleged manipulation of a essential benchmark primarily based on the gold price, is facing a fresh lawsuit filed in Canada.
Attorneys at Sotos LLP, Koskie Minsky LLP and Camp Fiorante Matthews Mogerman are searching for class action standing for the lawsuit filed in the Ontario Superior Court of Justice.
In a statement Tuesday, the law companies mentioned they are searching for up to $ one billion in damages or compensation on behalf of Canadian traders who purchased “a gold marketplace instrument either directly or indirectly” among Jan. 1, 2004, and March 19, 2014.
The lawsuit alleges the defendants, including Bank of Nova Scotia, “conspired to manipulate rates in the gold industry beneath the guise of the benchmark repairing method, recognized as the London PM Repairing, for a 10-year period,” the law firms said in the statement.
“It is further alleged that the defendants manipulated the bid-inquire spreads of gold industry instruments all through the trading day in order to increase their income at the cost of the class.”
None of the allegations has been confirmed, and the case can not move forward as a class action except if certified by a court.
“We believe that this matter has no merit and will defend ourselves vigorously,” a spokesperson for the Financial institution of Nova Scotia mentioned in an emailed statement. “As this matter is prior to the courts we are unable to comment more.”
Scotia is also among a handful of economic institutions like Barclays PLC and Deutsche Bank AG named in a lawsuit filed in New York last yr, which alleges five banking institutions overseeing the setting of a century-old benchmark known as the London gold resolve colluded to manipulate it.
Kirk Baert, a spouse at Koskie Minsky who is involved in the lately filed Canadian lawsuit, explained he believes it is the 1st situation in this nation to make claims towards banks concerned in the setting of the gold cost and benchmarks.
“It is the very first I know of,” Baert explained, incorporating that the situation includes “really troubling allegations.”
Scotia became a large player in the gold market in late 1997 with the acquire of the precious metals organization of Standard Chartered Bank. That deal transformed Scotia from the most significant Canadian valuable metals player to a worldwide force, and landed the Canadian financial institution a seat at the table for the prestigious London gold fixing, a twice-everyday auction that served as a pricing mechanism for the treasured metal.
Scotiabank’s gold division, Scotia Mocatta, as properly as parent business Bank of Nova Scotia and Scotia Capital (USA) Inc. are named in the observe of action filed in connection with the Canadian lawsuit.
Barclays Bank, Deutsche Bank Securities, SBC Securities, Société Générale, and UBS AG are also identify as defendants.
Given that the economic crisis of 2008, regulators have probed the cost-setting mechanisms of a amount of crucial benchmarks, such as an curiosity rate benchmark acknowledged as LIBOR.
In accordance to Tuesday’s statement from the law firms behind the latest lawsuit involving the gold benchmark, the United States Department of Justice is in the midst of an “energetic and ongoing” investigation of the value-setting practices, and the Commodity Futures Trading Commission is also investigating.
“Other law enforcement and regulatory authorities in the United States, Switzerland, and the United Kingdom have active investigations into the defendants’ perform in the gold marketplace,” the statement from the law companies explained.
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