Gold is now the latest bank price-fixing scandal

As if there weren’t enough reasons to cast a jaundiced eye on the banking system, Bloomberg reports that several international banks are now accused of manipulating a key benchmark, known as the gold fix, in the $20 trillion gold market. The charges of fixing gold prices in London are being leveled at Barclays, Deutsche Bank, ScotiaMocatta (the metals-trading division of Canada’s Scotiabank), Société Générale, and HSBC by New York resident Kevin Maher, who filed a lawsuit against the banks in a US federal court yesterday evening (Mar. 4). The lawsuit follows a draft research report published last week by New York University Professor Rosa Abrantes-Metz and Moody’s Investors Service analyst Albert Metz, noting unusual patterns in the gold benchmarks.

The allegations mark the latest knock to global banks’ role as rate setters in key areas. Most recently some 15 banks and more than 20 traders have been facing a worldwide probe into charges that they’ve been manipulating exchange rates. A month ago New York’s top financial regulator, Ben Lawsky jumped into the fray, launching a probe into forex manipulation against banks chartered to operate in New York.