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Johannesburg – The settlement agreement between Citibank and the Competition Commission will be heard by the Competition Tribunal on March 22. This is according to a statement issued by the Tribunal on Friday.
Citibank has agreed to pay a settlement over R69.5m (R69 500 860) for its role in an alleged forex cartel, since 2007.
Citibank along with fifteen other banks, are being challenged. These include Bank of America Merrill Lynch International Limited, BNP Paribas, JP Morgan Chase & Co, JP Morgan Chase Bank NA, Investec Ltd, Standard New York Securities Inc, HSBC Bank Plc, Standard Chartered Bank, Credit Suisse Group; South Africa Ltd, Commerzbank AG; Australia and New Zealand Banking Group Limited, Nomura International Plc, Macquarie Bank Limited, Barclays Capital Inc, Barclays Bank plc (Respondents).
The Commission is not seeking an administrative penalty against Absa, which was one of the banks that were investigated. Absa tipped off regulators about the price-fixing and suspended two of its traders.
Absa CEO Maria Ramos further apologised over its role in the cartel.
READ: Maria Ramos says sorry for Absa's role in rand fixing
Another South African bank, Investec, said it will work with the competition authorities with regard to their investigation.
These banks had a general agreement to collude on prices for bids, offers and bid-offer spreads for the spot trades in relation to currency trading involving the US Dollar/Rand exchange.
The banks agreed to refrain from trading and creating fictitious bids and offers at particular times.
The Commission is seeking an order declaring that the banks are liable for the payment of an administrative penalty equal to 10% of their annual turnover.
However, the figure to be paid by Citibank does not exceed 10% of the bank’s annual turnover in South Africa, Fin24 previously reported.
Citibank has declared its intentions to cooperate with the Commission making available witnesses to assist in the prosecution of the other banks that colluded.
READ: How banks allegedly colluded on currency trades
Since the collusion reports, President Jacob Zuma, the ANC and National Treasury have also weighed in on the matter, calling for tighter control measures to stop anti-competitive practices and urgent remedies to the "over-concentration" in South Africa’s banking sector.
The ANC particularly called for the punishment of these banks whose alleged acts of corruption have “crudely exposed” an ethical crisis in the South African banking sector.
However, opposition party, the Democratic Alliance said the timing of the price-fixing case seemed suspicious.
"The timing of the announcement does seem a little suspicious, coming hot on the heels of [President Jacob] Zuma's State of the Nation Address (SONA), in which he made it clear that the competition authorities would be used as one of the main tools of 'radical economic transformation' going forward," said MP Michael Cardo.
READ: Collusion case strengthens Zuma's hand in battle with banks
Analysts say that the timing could not be worse, especially considering that banks have been trying to maintain the moral high ground after closing the Gupta family's accounts, Bloomberg reported.
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