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.