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Citigroup Said to Be Ousted From ECB FX Group for Rigging

OWoN: Goodbye Citigroup soon. 

This stings, one must wonder what other banks think about interact day lending to this institution as to risk implications.

A Citi logo sits outside the offices of Citigroup Inc. in London. Citigroup is the world’s biggest foreign-exchange dealer, with a 16 percent market share, according to a survey by London-based Euromoney Institutional Investor Plc - Image: Chris Ratcliffe/Bloomberg

Citigroup Said to Be Ousted From ECB FX Group for Rigging

By Gavin Finch
21 November 2014

The European Central Bank ejected Citigroup Inc. (C) from its foreign-exchange market liaison group after the U.S. bank was fined for rigging the ECB’s own currency benchmark, two people with knowledge of the move said.

The ECB removed Citigroup from the panel, which advises the central bank on market trends, after regulators fined the lender $1 billion for rigging currency benchmarks including the ECB’s 1:15 p.m. fix, said the people, who asked not to be identified because the decision hasn’t been made public.

Citigroup was one of six banks fined $4.3 billion by U.S. and U.K. regulators last week and is the only one that also sits on the ECB Foreign Exchange Contact Group. About 20 firms with large foreign-currency operations, ranging from Airbus Group NV to Deutsche Bank AG (DBK), sit on the committee. The panel’s agenda includes how to improve currency benchmarks.

Citigroup is the world’s biggest foreign-exchange dealer, with a 16 percent market share, according to a survey by London-based Euromoney Institutional Investor Plc. A spokesman for the New York-based bank declined to comment.

The panel isn’t involved in how the ECB’s daily fix is calculated. Currency benchmarks such as the ECB fix and the WM/Reuters rates are used by asset managers and pension funds to value their holdings, including $3.6 trillion in index tracker funds around the world.

According to documents released with the settlements, senior traders at the firms shared information about their positions with each other and coordinated trading strategies to the detriment of their clients. They’d congregate in electronic chat rooms an hour or so before benchmark rates were set to discuss their orders and how to execute them to their mutual benefit.

$99,000 Profit

In Citigroup’s settlement, the U.K.’s Financial Conduct Authority gave an example of a day when dealers at the bank joined three other firms to manipulate the ECB 1:15 p.m. fix.

The Citigroup trader told the group he had client orders for 200 million euros ($249 million) at the ECB fix rate. By buying the currency for less and then pushing up the rate at which he would offer it to the client, he could make a bigger profit. The others agreed to transfer their buy orders to him and offload any positions that ran counter to his strategy to maximize his chances of success, the FCA said.

Over the 33 seconds around 1:15 p.m., the Citigroup dealer made several transactions, buying 374 million euros for more than the best rate to push up the fix.

The bank made a $99,000 profit on the trades, the FCA said.



  1. London Gold Pool II On The Verge Of Collapse As Panic Nears

    With the war in gold continuing to rage, today one of the most respected veterans in the gold world told King World News that the Western central bank cartel which has been capping the gold price for more than a decade is nearing the point of collapse as panicked phone calls are now being made to acquire sizable amount of gold.

    “First, there are the hedge funds and specs that are short the gold price. They want to exit their positions with as much profit as possible. So they are defending their short positions with even more shorting in the hope of getting lower prices, which partly explains why Comex open interest has been rising even as the gold price has risen the last few weeks.

    But those still short are probably kicking themselves that they didn’t cover when gold was $60 lower. Then there are the central planners who are short and fighting the rise in the gold price by selling ever more promises to pay gold in the future. But interestingly, Eric, there are central planners on the other side too. These are the central banks and other government entities that have bought paper gold in anticipation of taking physical delivery. There are also some institutional buyers in this group.

    But regardless whether they are in the public or private sector, they are riding in the same boat. All they hold are paper promises to receive physical metal. And now this group is starting to become aggressive in taking delivery. They don’t want cash settlement -- they want physical metal. (read more at link)

  2. Here Comes France: Right-Wing Leader Marine Le Pen Demands Central Bank Repatriate French Gold

    First Germany, then the Netherlands, perhaps Switzerland this weekend, and now the French right-wing Front National, which shockingly came first in May’s European parliament elections, and whose leader Marine Le Pen is currently polling in first place in a hypothetical presidential election (in both a first and run off round), ahead of president Hollande, has sent a letter to the governor of the French Central Bank, the Banque de France, demanding that France join the list of nations which have repatriated, or at least tried to, their gold.
    From her letter, here is the full list of French demands (google translated):
    Urgent repatriation on French soil of all of our gold reserves located abroad.
    An immediate discontinuation of any gold sales program.
    Conversely, a gradual reallocation of a significant portion of foreign exchange reserves in the balance sheet of the Bank of France by buying gold at each significant decrease in the price of an ounce (recommendation 20%) .
    A suspension of any financial commitment or loan contract would wager that our gold reserves.
    At the patrimonial and financial balance of the 2004 gold sales transactions ordered by N. Sarkozy.

  3. MassMutual Senior Vice President Found Dead, Stabbed In Chest In Apparent Homicide

    A week after stunned Tribeca woke up to news of a grizzly death in which a Citigroup managing director living on Greenwich Street was found dead in his bathtub with a slashed throat and the lack of a suicide weapon on the scene suggesting there was foul play involved, another banking executive was killed over the weekend, when 54-year-old Melissa Millian, a senior vice president at MassMutual, was found lying in a road in Simsbury, Connecticut, having been stabbed in the chest.
    As CBS reports, initially there was speculation Millian may have been in a bicycle accident, or may have been the victim of a hit-and-run. However on Saturday, the office of the Chief State Medical examiner said the cause of her death was a stab wound to the chest, and the manner was homicide.
    According to WCVB, Millan, a mother of two, was a senior vice president at MassMutual in Springfield. A spokesman for the company said she was a tremendous leader and deeply caring and that she would be missed.
    Passing motorists found Millan lying on the ground Thursday at 8:04 p.m., according to Simsbury police.
    Police said she could have been out jogging but that they did not yet know what happened and are investigating. Millan was taken to St. Francis Hospital where she died, according to police.
    Police announced Saturday they were investigating the incident as a homicide.

  4. P
    Watching the coverage by BET network about the protesters regarding Mike Brown...what they are doing was done back in the 60's and that method effecting no one and nothing except them. They need to concentrate on formulating an economic block which can effect revenues...they can protest all they want. The only way they listen is to affect their money and the pigs will come hollering.

    This is why this system is set up as a divisive trap to make sure that it's difficult for people to come together with common interests and with integrity. People don't realize if they gather as in their protests and refuse to spend any money, refuse to use any electricity, refuse to spend at the gas pumps and supermarkets, and refuse to spend any money within a 48 hour period...somebody is going to stop and take notice...disconnect every appliance in the kitchen, don't use any electricity...this is real protest...almost like a hunger strike! Money have no race, money is green and they are ruled by this tool...instead of using it, it uses them. It's all a result of economic's all so sad!

    We either stand for something or we stand for nothing at all!

  5. Fedup absolutely, but, it's when people start working outside the system it gets interesting. That's a big why like the 3D printers and open source platforms so much. Options!

    Setting up communities outside the electric system with their own home grown technologies or what is available in solar, wind, hydro, geothermal, or......

    Food can be grown and raised by a community working together and if there is enough trades in the area, most needs can be met. Community co-ops for banking and alternate currency for in-community use.

    Transportation, with so many new technologies in the playing field, communities can create their own answers. Some may also be built right there if they have the engineers familiar with the process. Communities can be self sustaining, they simply have forgotten how . And with new technologies and processes daily worldwide, active communities can make new opportunities for themselves through shared platforms.

    So far some have tried and been swatted down here in the US. But the how to do it is growing rapidly and the desire to do so is even faster. Once people realize working together what they can do, shazam.... it will happen.It's realizing they can do it and at the same time help their community flourish.

    In a nutshell it comes down to knowing your neighbors and the people in your community. If they're not willing, go some where they are. Or, if your options are limited and you have to make do, start by finding those in your community that are of like interest. Build on what you have.

    1. P
      Exactly! I am all in...both feet first!

      Thank you.

  6. Fedup, something from Yale...

    Small Enough to Manage, Big Enough to Matter

    Author: Andrew K. Barnett

    Start Anyway. Sorry to lay it all on the first line, but there it is. None of us knows enough, has enough money, pulls enough strings, or carries the clout to justify a new project. Start anyway.

    We can all pose unanswered questions that will kill a new idea before it gets out of committee – how will we pay for it, what will the neighbors say, what if ______ (insert the name of your local curmudgeon) gets upset, who’s to serve on the committee, what will we call the committee, do we even need a committee? These legitimate issues could clog a year’s worth of meetings.

    Finding Answers Faster
    But when we start anyway, we find answers faster. Invited to the inevitable messiness of new ideas, people take ownership and solve problems – tomatoes in need of stakes, say, or hungry guests waiting for bread. Intractable social ills suddenly offer concrete solutions and specific ways to get involved. Theology gets done.

    Food justice is an element of the larger global fight for human dignity. As the 21st century trends toward 10 billion people and a very harsh global climate, we can only love neighbor as self when we work for a stable climate, a just society, and food security. When we synchronize initiatives that are small enough to manage and big enough to matter, devising solutions that make sense in specific places and times, then we pair local cost with local benefit, and things actually happen. Parks get built. Gardens get planted. Food gets served. We tunnel through political barriers.

    We mobilize pockets of political will. We cultivate partnerships and invent possibilities that we had never imagined. We get out of the office and onto the streets. Engaging our communities, enriching our spiritual and physical wellness, it’s possible to make measurable progress on issues Jesus cares about most passionately: human dignity for all, love for neighbor and self.

    Planting Seeds of Hope
    Two years ago, when Bishop Jon Bruno asked urban farmer Tim Alderson to help the Episcopal communities of Los Angeles build an integrated harvest and food distribution system, the bishop’s first words were, “We’ll start in January.”

    Courageously, Tim took the job, built a program called Seeds of Hope, and I was thrilled to join his team recently. The work matters, because South-Central LA is a food desert, where 72 percent of the food shops offer nothing but fast food.1 Despite the energy,

    1. Continued from above

      water, and pollution costs of a bacon double cheeseburger, it’s a shocking irony that the meat sandwich is still cheaper and easier to buy than veggies in low-income communities. Fresh produce is a luxury good in the city.2 Drive across town to the wealthier western side, and you’ll find only 41 percent of the restaurants serving fast food. The difference in life expectancy is about 12 years, due largely to food-related illness in poor communities. That’s the same gap that separates the United States from North Korea, and it’s wrong.

      Twenty-four months ago, Seeds of Hope started as a new idea with lots of unanswered questions. Now it coordinates gardens at 75 churches and 22 schools, and we share fresh produce with 60 food pantries and 50 feeding programs. We won a $900,000 grant from the LA health department to help community leaders support nourishing food cultures. The Seeds of Hope innovation is to coordinate land, people, money, and community centers, all dedicated to bringing healthy food to people who need it. The goal is to farm the diocese and feed people real food.

      Food allows us to sow relationships, re-cultivate a sense of gratitude, and fertilize community in ways only God can predict. Praying shapes believing. Doing does too. Lex agendi, lex corandi: What we do, we believe.

      Does this work matter? Only time will tell. I can say it’s exciting to see people become aware of capacities they didn’t know they had. It is holy to partner with faith communities venturing beyond the stained glass and stone walls to break bread together. In a complex system, we only have control over ourselves. But I am in charge of me and you are in charge of you. If we want to spark a movement, start moving.

      Even and especially when we don’t know all the answers, start anyway.

      The Rev. Andrew K. Barnett holds the Bishop’s Chair for Environmental Studies and Food Justice in the Episcopal Diocese of Los Angeles. He is a 2012 graduate of Yale’s Divinity and Environment Schools and pianist with the Theodicy Jazz Collective.

      1 “Food Systems Snapshot 2013,” Los Angeles Food Policy Council. See /2013-food-system-snapshot.
      2 “Food Systems Snapshot 2013.”

      - See more at:


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