PhD thesis stirs up a $1bn gold-price trial for global banks
By GCRU Gold News on Friday, October 14 2016, 22:21 - Permalink
An Australian academic’s discovery of global gold price collusion has sparked a looming US trial in which four of the world’s major banks are being sued for up to $1 billion over claims they rigged the price of the precious metal at the expense of investors over a decade.
Perth-based Andrew Caminschi can be revealed as the academic who unwittingly exposed a scandal during a painstaking study of tens of millions of gold transactions that took him 18 months.
During his research, the academic discovered apparent manipulation during the twice-daily meetings held by banks in London that determined the benchmark price of gold, which was then used by dealers, central banks and mining companies to trade the precious metal.
The analysis of 14 years of raw data found that during these meetings, and before the benchmark price became known, trading volumes in gold derivatives would rise substantially. This suggested the banks were trading on, and potentially profiting from, information that was not available to the wider market — a theory that had been rumoured for years but never proven.