More on the Barclays gold-fixing fine


Needing a "mini puke to $1,558 for fixing," Barclays trader (now ex-trader) Daniel Plunkett got it, nailing a bank client for $3.9M on a derivatives contract. Thus started the investigation into the bank's manipulation of the gold fix for which it was fined $44M today. The former trader also was handed down a fine and a banning from the industry.

Plunkett's actions that in 2012 came only one day after Barclays was fined a £290M over Libor manipulation which eventually led to the exit of CEO Bob Diamond.

Today's action brings further questions over the future of the decades-old gold fix. Deutsche has already resigned from the small group of lenders involved in the process. "If [the gold-fixing banks] want to continue to operate the fix in any way like they're doing they will need to be a lot more transparent about what's going on," says finance professor Brian Lucey.

Previously: Barclays escapes with small fine for gold manipulation

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Comments (21)
  • 6151621
    , contributor
    Comments (1172) | Send Message
     
    No need for this type of fix in modern markets. It would be better if it were randomized to some extent so this type of short term manipulation weren't feasible.
    23 May 2014, 09:17 AM Reply Like
  • The EconomicJoker
    , contributor
    Comments (958) | Send Message
     
    One day, when bankers and central bankers start getting killed by normal people, maybe the manipulation will stop. I'm not advocating it or calling for it to happen... I just see it coming.
    23 May 2014, 09:23 AM Reply Like
  • capitolp
    , contributor
    Comments (713) | Send Message
     
    Don't know about killing one, but I would love to " female dog" slap a couple banker fellas.
    23 May 2014, 12:37 PM Reply Like
  • Vooter
    , contributor
    Comments (487) | Send Message
     
    Yup...and it SHOULD come...
    24 May 2014, 11:16 AM Reply Like
  • minecanary
    , contributor
    Comments (1191) | Send Message
     
    Easy there Joker. You just got us all put on the NSA watch list (and our relatives and 3rd cousins).

     

    What gets me is say they are afraid of prosecuting the banks or head bankers as it may affect their underlings. It seems they are letting the 90% go to avoid harming the 10%.
    24 May 2014, 11:35 AM Reply Like
  • Brian58
    , contributor
    Comments (277) | Send Message
     
    $44 million? LOL. Curious as to how many Billions they made.
    23 May 2014, 09:57 AM Reply Like
  • cash
    , contributor
    Comments (681) | Send Message
     
    Yup. Pay & Continue to Play is Obama's workbook for Wallstreet. What is in it for the politicians in govt if they cannot use their positions to get some mileage for the next exlection
    23 May 2014, 10:19 AM Reply Like
  • johnproto
    , contributor
    Comments (38) | Send Message
     
    Oh, and don't forget when Henry Paulsen gave the banks "The Gift" that kept on giving on behalf of Prez Bush's playbook.
    23 May 2014, 11:04 AM Reply Like
  • Jason Burack
    , contributor
    Comments (2124) | Send Message
     
    The fine is a slap on the wrist compared to billions in profits made for many decades. Based on my research, gold and silver have been manipulated for a very long time. Since at least the 1920s and there's books like Ferdinand Lipps' Gold Wars and The Gold Cartel from Demetri Speck providing a lot of evidence.
    23 May 2014, 01:45 PM Reply Like
  • Brian58
    , contributor
    Comments (277) | Send Message
     
    Right your are Jason. And as we speak they will pin it to the $124.50 strike price due to Option Expiration.
    23 May 2014, 03:48 PM Reply Like
  • Brian58
    , contributor
    Comments (277) | Send Message
     
    oh forgive me: I was off by a penny... They don't want to make it too obvious with an investigation going on.
    23 May 2014, 04:01 PM Reply Like
  • Robin Hewitt
    , contributor
    Comments (5370) | Send Message
     
    >>"Pay & Continue to Play is Obama's workbook for Wallstreet."<<

     

    From the (linked) news article:
    Barclays Plc (BARC) was fined 26 million pounds ($44 million) by BRITAIN's markets regulator

     

    (emph added)

     

    You did know Barclay's is a British bank, right? With HQ in London, right?
    23 May 2014, 10:30 PM Reply Like
  • Ray Lopez
    , contributor
    Comments (1815) | Send Message
     
    The issue is how much manipulation affects the true market price of gold. I would say it's small, meaning manipulation pushes gold say 1-3% from the 'true' market price if there was no manipulation. It's hard to 'corner' a market long term, as any 19th century robber baron would tell you. So I doubt gold manipulation is keeping gold from 2x or 10x of its true price; more like 1-3%. Still, that's a nice margin to have, as any high-frequency trader knows.
    24 May 2014, 02:04 PM Reply Like
  • lasvegasbrad
    , contributor
    Comments (56) | Send Message
     
    Imagine, even Lois the hag Lerner is still free. If she can escape prison, what restraint remains for the hoards of other bureaucrats?

     

    Further dream that we have a crooked politician jail, with at least some of the worst residing therein.

     

    Top-Down. All these hot shot brokers see dumb politician getting away with it, so they emulate.
    23 May 2014, 10:34 AM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (4382) | Send Message
     
    Eventually, neither London nor New York nor Chicago will be setting gold prices. It will be done on the Shanghai exchange and the Dubai exchange. The sooner the London gold fix and the COMEX precious metals markets are abolished, the better.
    23 May 2014, 11:14 AM Reply Like
  • 6151621
    , contributor
    Comments (1172) | Send Message
     
    @David, Wherever the main market is determining prices or rates may be, the idea of a private group or bankers doing the fix is outdated.
    23 May 2014, 12:35 PM Reply Like
  • jsIRA
    , contributor
    Comments (4086) | Send Message
     
    Stock market is full of manipulation. Gold price fixing is only one of them. That is who Wall Street makes money.

     

    For example, they can push an IPO stock sky high and then dump it to ground.
    23 May 2014, 12:56 PM Reply Like
  • Vooter
    , contributor
    Comments (487) | Send Message
     
    And that's why we need GAS CHAMBERS....
    24 May 2014, 11:18 AM Reply Like
  • june1234
    , contributor
    Comments (4249) | Send Message
     
    Do your thing, pay your fines(more like kickbacks), back to work, just the cost of doing business. Credit Suisse got criminally convicted and they still around. Hard to put a logo in jail I guess.
    24 May 2014, 05:37 AM Reply Like
  • jahnman
    , contributor
    Comments (2) | Send Message
     
    I think in good faith they should at least return the gold price back to 1700 bucks
    25 May 2014, 06:05 AM Reply Like
  • jahnman
    , contributor
    Comments (2) | Send Message
     
    I say in good faith they return the gold price back to at least 1700 to make it right!
    25 May 2014, 06:05 AM Reply Like
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