The Financial Conduct Authority (FCA) condemned Barclays bank this Friday to a 26 million-pound Sterling (32 million euro-) fine for attempting to rig the gold market.
The UK financial regulatory authority judges that the bank failed to « adequately manage conflicts of interest between itself and its customers », since Barclays was selling derivatives on gold as it was part of the price fixing entities.
This sanction is a first in the investigations by the market regulators on a presumed manipulation of the gold market in London.
A former trader, Daniel Jamies Plunkett, is also now banned to operate in the financial sector for having « tried to influence » the price fixing process by exploiting « weaknesses in Barclays’ systems » to influence the gold fix.
« Barclays' failure to identify and manage the risks in its business was extremely disappointing », said a FCA official in a statement.
Barclays had been the first bank condemned to pay fines in the LIBOR and EURIBOR rate manipulation scandal in 2012 which, apparently, hasn’t kept them from doing it again, since these actions took place the day after the publication of the actions against Barclays in LIBOR and EURIBOR...
Let’s not forget that the prices of gold and silver established in London are used as benchmarks for all the other markets. Prices are fixed twice a day by conference call between four banks : Bank of Nova Scotia, Barclays, HSBC and Société Générale. The Deutsche Bank used to be part of the fixing mechanism but it announced in May that it was no longer going to participate in the fixing of gold and silver prices.