Zero Hedge – Ten Banks, Including JPM, Goldman, Deutsche, Barclays, SocGen And UBS, Probed For Gold Rigging


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Submitted by Tyler Durden on 02/23/2015
No matter how many times the big banks are caught red-handed manipulating precious metals, some failed former Deutsche Bank prop-trader (you know who you are) will take a vociferous stand based on ad hominem attacks and zero facts that no, what you see in front of you is not precious metal rigging at all but a one-off event that has nothing to do with a criminal banking syndicate hell bent on taking advantage of anyone who is naive and dumb enough to still believe in fair and efficient markets.

The last time this happened was in November when we learned that “UBS Settles Over Gold Rigging, Many More Banks To Follow”, and sure enough many more banks did follow, because in Europe, where the stench of gold market manipulation stretches far beyond merely commercial banks, and rises through the central banks, namely the BOE and ECB, culminating with the Head of Foreign Exchange & Gold at the BIS itself, all such allegations have to be promptly settled or else the discovery that the manipulation cartel in Europe involves absolutely everybody will shock and stun the world, which heretofore was led to believe that such things as gold market (not to be confused with Libor or FX) manipulation only exist in the paranoid delusions of a few tinfoil fringe-blogging lunatics.

However, as usually happens, someone always fails to read the memo that when it comes to gold-market manipulation one must i) find nothing at all incriminating if one is a paid spokesman for the entities doing the manipulation such as former CFTC-sellout Bart Chilton or ii) if one can’t cover it, then one must settle immediately or else the chain of revelations will implication everyone.

This time, that someone is the US Department of Justice, which as the WSJ just reported, is investigating at least 10 major banks for possible rigging of precious-metals markets. The DOJ is shockingly doing so “even though European regulators dropped a similar probe after finding no evidence of wrongdoing, according to people close to the inquiries.” Of course, the reason why said probe was dropped in Europe is because it would have implicated virtually the entire trading desk at the biggest and most important European bank: Deustche Bank, as well as the biggest bank in Switzerland, UBS and UK’s own Barclays, reveal a manipulation cartel rivaling even that of Libor. And once traders at the commercial banks turned sides and squealed for the prosection, well then it would be the central banks’ turn next. Which is why it was imperative to bring this investigation to a quiet end.

But not in the US.

According to the WSJ, “prosecutors in the Justice Department’s antitrust division are scrutinizing the price-setting process for gold, silver, platinum and palladium in London, while the Commodity Futures Trading Commission has opened a civil investigation, these people said. The agencies have made initial requests for information, including a subpoena from the CFTC to HSBC Holdings PLC related to precious-metals trading, the bank said in its annual report Monday.

HSBC also said the Justice Department sought documents related to the antitrust investigation in November. The two probes “are at an early stage,” the bank added, saying it is cooperating with U.S. regulators.

Who is involved in this latest gold-rigging scandal? Why everyone! … which makes it immediately obvious why the European regulator had to promptly cover up the whole affair. Under scrutiny are Bank of Nova Scotia , Barclays PLC, Credit Suisse Group AG , Deutsche Bank AG , Goldman Sachs Group Inc., J.P. Morgan Chase & Co., Société Générale SA, Standard Bank Group Ltd. and UBS AG , according to one of the people close to the investigation.

Robert Hockett, a law professor at Cornell University, said it is “not particularly surprising” that the Justice Department is plowing ahead despite the decision by European regulators. Recent scrutiny of big banks’ operations in the physical commodities markets and criticism of the Justice Department’s financial-crisis track record make it “quite understandable” that the agency would investigate allegations of precious metals price-rigging.

Last year, the FCA fined Barclays £26 million ($40.2 million) for lax controls after one of its traders allegedly manipulated the gold fix at the expense of a client.

Swiss regulator Finma settled last year allegations of foreign-currency manipulation with UBS. The regulator said it found “serious misconduct” among precious-metals traders at UBS, including “front running,” or trading ahead of, the silver-fix orders of one client. A spokeswoman for UBS, which said at the time that it “instituted significant cultural and compliance changes,” declined further comment.

You mean to say that the banks that were for decades rigging Libor… and FX… and bonds… and stocks… oh, and gold, were let go with a slap on the wrist and a promise to “change their ways” and not to do it again? Yup, that’s exactly right.

So what happens next? Well, we finally will find just how much of a banker-controlled muppet the so-called US attorney general truly is. Recall that a week ago he gave his subordinates 90 days to being cases against individuals for their role in the financial crisis.

Well here is the perfect opportunity. Should Holder let this latest mass criminal ring go without any incarecration, one can officially stick a fork in the US justice system, which is meant for everyone, but the rule-flouting bankers who can clearly get away with absolutely anything.

As for the rigging in the gold market, rigging which begins with the lowliest prop-traders at Deutsche Bank and involves every single central bank and High Frequency trading outfit and is now a proven fact, we have explained over the years and thousands of times just how to end it all, so instead of wasting readers’ time on this topic yet again, here are just two very simple solutions how to fix this one particular market:

@StockCats

all trading in “paper” gold should cease immediately and all contracts be settled in physical for true price discovery
3:53 PM – 24 Feb 2015
@StockCats

audit Fort Knox
4:08 PM – 24 Feb 2015
So simple, even the most corrupt US Attorney General caveman can do it.

http://www.zerohedge.com/news/2015-02-23/ten-banks-including-jpm-goldman-deutsche-barclays-socgen-and-ubs-probed-gold-rigging

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Karen Hudes: DOJ creating fascistic cooperatives thru plea agreements


Courtesy of Karen Hudes Facebook page:

From: Kevin
Date: Tue, Feb 4, 2014 at 10:35 AM
Subject: DOJ creating fascistic cooperatives thru plea agreements
To: Karen

You should take a look at the things Par Pharmaceutical agreed to when they were busted for defrauding the government. Nothing especially abnormal in the primary part of the plea. Par and all their executives were spared any time behind bars and although they were fined about 100 million dollars, they defrauded the government out of billions…so as far as the money goes…Par won big!

What I thought was a bit odd was the plea agreement was 150 pages long. (Maybe that’s typical but I thought that was a lot of pages for a plea) so I decided to read it.

What the government has required of Par is amazing. If this is being done to other corporations that have run a foul with the government, it appears that this is a very slick way of “legally” creating a fascistic cooperative relationship between our government and I’d assume any company/corporation that the government wants to. With the access the NSA has to everything everyone does or says…it would be childs play to blackmail any corporation.

Briefly, Par is required (for 5 years) to create 4 or 5 new departments where it appears they are being encouraged to hire government “specialists” in each department. The government has provided very specific instructions for those departments. One is for spying on their employees. Once is for spying on customers. One is to enforce compliance with obamacare. One is for constant review of all financials…including executives personal records. There is more…much more.

Par is required to keep watch on all of its customers, vendors, and associated businesses and report back to the OIG (office of the inspector general) if Par even suspects that any of the might be operating in any manner that is inconsistent with any government regulation especially obamacare. Par is required to provide a list of employees who refuse to sign up for obamacare. Par is required to have a complete education department devoted solely to convincing employees to sign up for obamacare. Par is required to produce “independent” advertising to promote obamacare specifically but government in general.

And Par will have a difficult time opting out of this totalitarian agreement by just throwing in the towel after they sign their get out of jail free card. They are not allowed to file bankruptcy for 5 years….and I don’t think the CEO or any of the board members are allowed to resign. (That was a bit unclear but I think it was a veil threat)

Par Plea agreement

http://www.justice.gov/usao/nj/Press/files/pdffiles/2013/Par%20Pharmaceutical%20Plea%20Agreement.pdf

It’s a sobering read.

Feds Say They Will Go Easy on Banks Doing Business with Marijuana Dispensaries


During the groundbreaking phone call on Thursday, August 29 in which U.S. Attorney General Eric Holder told [3] the governors of Colorado and Washington the federal government would not attempt to intercept regulated legal marijuana in their states, he also said the Department of Justice (DOJ) is “actively considering” how to oversee the relationship between banks and marijuana shops.

According to the Huffington Post, [4] Holder told the governors as long as marijuana shops “operate within state laws and don’t violate other federal law enforcement priorities” the DOJ is looking to regulate those interactions as legal.

Rep. Ed Perlmutter (D-Colo.), a senior member of the House Financial Services Committee, released a statement [5] on Thursday calling for a hearing to discuss his proposed bill, Marijuana Businesses Access to Banking Act (HR 2652). In the statement, he raised concerns over “public safety, crime, and lost tax revenue associated when these legal and regulated businesses are operating in a cash-only system.”

He continued:

“We need to provide financial institutions certainty they can make their own business decisions related to legal, financial transactions without fear of regulatory penalties. Currently, under federal banking laws, many legal, regulated legitimate marijuana businesses operating legally according to state law are prevented from maintaining bank accounts and accessing financial products like any other business such as accepting credit cards, depositing revenues, or writing checks to meet payroll or pay taxes. They are forced to operate as cash-only enterprises, inviting crime such as robbery and tax evasion, only adding to the burden of setting up a legitimate small business.”

To that regard, a senior DOJ official speaking on a condition of anonymity told Huffington Post “the department recognized that forcing the establishments to operate on a cash basis put them at greater risk of robbery and violence.”

CNN warned in a report [6] that since the new guidelines do not change federal money laundering laws, some large banks might “still be leery of doing business with marijuana producers and sellers.”

Along with Holder’s announcement on Thursday came a memo from Deputy Attorney General James Cole, addressed to U.S. attorneys nationwide. The memo [7] outlines eight priorities [3] intended to serve as strict guidelines the attorneys are required to follow as federal marijuana policy when prosecuting in the states where it is legal.

According to the Huffington Post [4], the anonymous DOJ official said, “For now, financial institutions and other enterprises that do business with marijuana shops that are in compliance with state laws are unlikely to be prosecuted for money laundering or other federal crimes that could be brought under existing federal drug laws, as long as those pot businesses don’t otherwise violate the priorities.”

In addition, the Huffington Post reported, the official said he “would not rule out prosecution in any case, but the new approach is a reversal of a DEA policy [8] that had warned banks not to work with marijuana businesses.

Washington Governor Jay Inslee and the state’s attorney general, Bob Ferguson thanked Holder for his efforts to work with the states’ decision to legalize and regulate pot, and called Holder’s announcement “good news” in a statement [9] on Thursday.

“Attorney General Holder also expressed a willingness to work with the states on a financial structure that would not run afoul of federal law,” they said, calling the news an “affirmation of good work” by the state Liquor Control Board, which the state put in charge of designing a system of regulation and implementation for the new marijuana laws.

They continued, “We can assure the Attorney General that Washington state will remain vigilant in enforcing laws against the illicit marijuana market.”

http://www.alternet.org/drugs/feds-say-they-will-go-easy-banks-doing-business-marijuana-dispensaries?paging=off