Deutsche Bank & Citi Foreclose On Venezuelan Gold And FX Market Rigging Banks Pay More Fines

An “event of default” had occurred due to the sanctions, as established in agreements underpinning the gold swap deals. Here’s more…

by Chris Powell of the Gold Anti-Trust Action Committee (GATA)

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Venezuela Loses $1.4 Billion of Gold to Banks for Guarantees, Sources Tell Reuters

By Corina Pons and Mayela Armas
CARACAS, Venezuela — Citibank and Deutsche Bank have taken control of around $1.4 billion of Venezuelan government gold, which they received as guarantees for loans, as a result of U.S. sanctions on the Venezuelan Central Bank, according to five sources.

Between 2014 and 2016 the central bank used a portion of its foreign gold reserves to guarantee financial operations with banks to boost liquidity, with the intention of repaying the loans to avoid losing the gold.

Five sources with knowledge of the deals said the BCV had agreed with Citibank and Deutsche Bank to buy back the gold in 2020 and 2021, but since the U.S. government imposed sanctions on the central bank in April, the banks had invoked a condition of the contracts to retain ownership of the bars.

Both banks had resolved that an “event of default” had occurred due to the sanctions, as established in agreements underpinning the gold swap deals, the sources said.

Citibank took control of gold for around $400 million BCV was supposed to repay in 2020. For a separate guarantee Deutsch Bank took $1 billion, the sources said. …

… For the remainder of the report:…

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FX market-rigging banks pay more fines, this time to Switzerland

By Hugo Miller and Stefania Spezzati
Bloomberg News
Citigroup and Barclays are among global banks fined a total of 90 million Swiss francs ($91 million) by Switzerland’s competition regulator for their roles in colluding on foreign-exchange rates.

Barclays was fined 27 million francs, Citigroup 28.5 million francs, and JPMorgan Chase & Co. was hit with a 9.5 million-franc penalty, Switzerland’s Competition Commission said today. UBS avoided a fine because it helped reveal the cartel.

The Swiss sanctions come after years of investigation by regulators on both sides of the Atlantic into how traders used chatrooms to fix leading currency exchange rates. Five of the banks agreed last month to pay 1.07 billion euros ($1.2 billion) to resolve a European Union probe into forex collusion. …… For the remainder of the report:…

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