Few players in the gold and silver markets are bigger than the Bank of
Nova Scotia, whose metals trading division, Scotia Mocatta, is
world-renowned. The Bank of Nova Scotia is a member of the London Bullion
Market Association and has had a seat at the daily London gold price fixing.
And this week the bank admitted to the U.S. Commodity Futures Trading
Commission that its traders manipulated the gold and silver futures markets
through "spoofing" from June 2013 through June 2016.
Rory Hall of The Daily Coin, who brought the CFTC's action to GATA's
attention today, notes that the developed has been grossly underreported:
https://thedailycoin.org/2018/10/02/another-b...igging-the-g...
Indeed, at this hour your secretary/treasurer can find only one news story
about it, from Marketwatch, which is very brief:
* * *
Bank of Nova Scotia Charged with Spoofing in Gold, Silver Futures
By Steve Goldstein
MarketWatch, New York
Monday, October 1, 2018
https://www.marketwatch.com/story/bank-of-...d-by-cftc-wi...
The Bank of Nova Scotia was charged by the Commodity Futures Trading
Commission with multiple acts of spoofing in gold and silver futures between
June 2013 and June 2016. Traders placed orders to buy or sell precious metals
futures contracts with the intent to cancel the orders before execution, the
CFTC said.
The CFTC fine was $800,000, as the CFTC said the penalty was substantially
reduced because the bank reported the conduct to the agency.
* * *
Far from criticizing the bank, the CFTC's announcement yesterday about the
misconduct actually praises the bank for having reported the misconduct
itself:
target="_blank"
https://cftc.gov/PressRoom/PressReleases/7818-18
The CFTC's enforcement director, James McDonald, says:
"This case is another great example of the significant benefits of
self-reporting and cooperation. We expect market participants to take
proactive steps to prevent this sort of misconduct before it starts. But, as
this case shows, there is a strong incentive for market participants to
quickly and voluntarily report wrongdoing when it is discovered and cooperate
with our investigation, as the Bank of Nova Scotia did here. In recognition
of its self-reporting and cooperation, the commission imposed a
substantially-reduced penalty."
* * *
Wikipedia notes Scotia Mocatta's key position in the monetary metals
markets throughout history:
target="_blank"
https://en.wikipedia.org/wiki/ScotiaMocatta
"The Mocatta firm has historically acted for central banks, notably
the Bank of England and the United States Treasury in market stabilizations,
notably the 1913 run on the Indian Specie Bank and the 1980 attempt by the
Hunt brothers to corner the silver market."
Of course spoofing the monetary metals futures markets might be considered
a mechanism of "stabilization" as well.
In any case market rigging now has been acknowledged to have been perpetrated
at the very center of the international gold and silver business.
Not that anyone but the tireless researcher of silver market rigging, Ted
Butler, will catch the significance of the dates in yesterday's announcement
from the CFTC, but the regulatory agency closed without result its
long-running investigation of silver market rigging in September 2013. That
is, the CFTC closed its investigation of silver market rigging three months after
the Bank of Nova Scotia's rigging of gold and silver futures began.
Maybe the CFTC's chronic blindness to the rigging of the monetary metals
markets gave the bank the impression that they were fair game.
