Silver bullion banks Deutsche Bank, Bank of Nova Scotia & HSBC accused of rigging prices
London (July 27) Silver bullion banks Deutsche Bank, Bank of Nova Scotia and HSBC have been accused of manipulating prices in the multi-billion dollar market in a lawsuit filed on Friday.
The lawsuit was filed in a New York district court by J Scott Nicholson, a resident of Washington DC and alleges that the banks, which oversee the century-old silver fix, manipulated the physical and COMEX futures market since January 2007.
Nicholson is seeking class-action status for the lawsuit, which was registered in the Southern District of New York.
Deutsche Bank and HSBC declined to comment. Nova Scotia was not immediately available for comment.
The lawsuit comes after a series of separate lawsuits were filed since March, accusing gold bullion banks of rigging the daily gold price. The five banks in those lawsuits have denied the allegations.
This is the first case to target the silver fix, although the silver market, whose prices have gyrated wildly in recent year, is no stranger to regulatory and legal scrutiny.
In a five-year probe, the US Commodity Futures Trading Commission investigated allegations that some of the world’s biggest bullion banks distorted silver futures prices.
The US commodity regulator found no evidence of wrongdoing and dropped the probe last September.
The lawsuit also comes at a critical time for precious metals markets, as regulators investigate trading around the setting of London’s daily gold and silver price benchmarks and the industry tries to find alternative ways to price their dealing.