Tulani Ngwenya
Johannesburg, South Africa – The South African Federation of Trade Unions (SAFTU) welcomes the resolution reached between the Competition Commission and Standard Chartered Bank (SCB), culminating in SCB agreeing to pay a settlement of R42 million. This landmark agreement comes after a prolonged legal battle lasting over seven years.
The Competition Commission initially lodged the case over 7 years ago, and the resolution represents a significant step towards holding financial institutions accountable for their actions. In a parallel case in the United States, SCB and others faced a fine of $40 million (approximately R727.5 million) for manipulating the US dollar with multiple currencies in various pairs.
Despite the prolonged litigation period, SAFTU applauds the determination of the Competition Commission and sees this settlement as a crucial development in bringing justice to the financial sector. The delay in accountability is particularly concerning, given that SCB and other implicated banks have already accepted guilt and paid fines in the United States and the United Kingdom.
“This is long overdue justice. The eight-year legal battle has been a game of hide-and-seek with these banks evading accountability in South Africa while acknowledging guilt and facing consequences elsewhere,” remarked Jabulani Khambule, the Regional General Manager for ACSA’s airport cluster and spokesperson for SAFTU.
The Competition Tribunal’s decision in March of this year, affirming its jurisdiction over the matter, dealt a significant blow to the banks’ attempts to evade accountability. SAFTU had welcomed this decision and continues to advocate for similar punitive actions against other implicated banks, emphasising the need for timely justice.
SAFTU has consistently called for stringent penalties against the 28 banks accused of manipulating the ZAR/US Dollar currency trading between 2008 and 2013. The alleged manipulation involved fixing bids, offers, bid-offer spreads, the spot exchange rate, and the exchange rate at the FIX. The impact of such manipulative practises on the country’s trade and economy cannot be understated.
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The revelations from the settlement agreement, such as those struck in the United States in 2019 between the New York State Department and Standard Chartered Bank, expose the collusive nature of these banks. Their actions, contrary to the principles of liberalism and free competition they claim to champion, reflect a non-competitive and monopolistic behaviour.
SAFTU emphasises the importance of penalising all 28 banks involved, calling on the Competition Commission to impose heavy fines on the local banks implicated. The organisation stresses that such behaviour, if repeated, poses a serious threat to the country’s balance of payments and growth prospects. Commercial banks, in SAFTU’s view, must be reminded that they are not more powerful than the state.
The SAFTU expressed hope that the Competition Commission will keep up its efforts to guarantee justice is served throughout the financial sector in a statement released by Deputy General Secretary Nontembeko Luzipo.
