Topics
Market Rigging (Financial Markets)
Market rigging refers to the illegal practice of manipulating financial markets for personal gain. It can take various forms, such as insider trading, price manipulation, and collusion among market participants. Market rigging can occur in any financial market, including stocks, bonds, commodities, and currencies.
Some recent examples of market rigging include:
- Libor Scandal: In 2012, several major banks, including Barclays and Royal Bank of Scotland, were found to have manipulated the London Interbank Offered Rate (LIBOR), which is a benchmark interest rate used in financial markets. The banks were accused of submitting false information in order to influence the rate and profit from trades.
- Forex Rigging: In 2013, several major banks, including Citigroup, JP Morgan and UBS, were found to have manipulated the foreign exchange market. The banks were accused of colluding to manipulate the benchmark exchange rate between different currencies, in order to profit from trades.
- Gold Rigging: In 2020, Barclays was accused of manipulating the gold market by prosecutors in the United States, who alleged that the bank engaged in a scheme to manipulate the price of gold and other precious metals futures contracts on the COMEX exchange.
Market rigging can have serious consequences for investors, as it can lead to artificially inflated prices, distorted market conditions and reduced market integrity. It can also lead to legal and financial penalties for the individuals and institutions involved.
Central banks and financial regulatory bodies have the responsibility to monitor and enforce regulations, and to ensure the integrity of the financial markets.
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Oligopoly - Collusion
Study Notes
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4.1.5.5 Oligopoly - Collusive Behaviour (AQA A Level Economics Teaching Powerpoint)
Teaching PowerPoints
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4.4.1 Roles of Financial Markets (Edexcel A-Level Economics Teaching PowerPoint)
Teaching PowerPoints
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4.4.2 Market Failure in Financial Markets
Study Notes
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What was the LIBOR-fixing scandal?
Study Notes
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Financial Market Failure (Financial Economics)
Study Notes
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Deutsche fined again over LIBOR rigging
26th October 2017