Category: Government Bond Market Manipulation

As previously reported, the central allegation of the action is that dealers in the secondary market for SSA (“supranational, sub-sovereign, and agency”) bonds colluded to reduce competition and to manipulate bond prices. The defendants include(d) many large financial institutions—BofA, Deutsche Bank, Barclays, Citigroup, Credit Suisse etc.—through both domestic and foreign entities. BofA and Deutsche Bank settled for $65.5 million in August 2017. Judge Ramos granted an initial motion to dismiss without prejudice in August 2018 because the complaint failed to allege with particularity how each defendant participated in the scheme, how each plaintiff was specifically injured by any individual transaction, and whether a conspiracy existed between the defendants. Plaintiffs filed an amended complaint in November 2018, and defendants moved to dismiss a second time. In January 2019, HSBC settled for $30 million. Judge Ramos considered the motion to dismiss in two stages. First, on October 4, 2019, he dismissed all claims brought against the foreign defendants and the individual defendants (all British) for lack of personal jurisdiction, with prejudice. Then, on March 18, 2020, he dismissed all claims against the remaining (domestic) defendants, also with prejudice. Continue reading SSA Bond Litigation Update: Remaining Claims Dismissed

In our October 22, 2019, post, we alerted you to a letter to the court by the Plaintiffs in consolidated actions, now known as In re Mexican Government Bonds Antitrust Litigation, 18-cv-02830 (In re MGB), requesting 45 days to file an amended complaint. Continue reading Plaintiffs in Mexican Government Bond Antitrust Case Settle With Two Defendant Groups; Get Defendants’ Evidence and Cooperation

It’s been a while since we’ve checked in on the In re SSA Bonds Antitrust Litig., 16-cv-3711 (ER), and things have not been going smoothly for the plaintiffs. In early October, Judge Ramos granted a motion to dismiss certain foreign defendants from the case for lack of personal jurisdiction. See In re SSA Bonds Antitrust Litig., 2019 WL 4917608 (S.D.N.Y Oct. 4, 2019). This update of the Manipulation Monitor summarizes the Judge’s opinion. Continue reading SSA Bond Litigation Update

In our October 4, 2019, post we noted several news reports on the dismissal of an antitrust lawsuit alleging a conspiracy to inflate the price of Mexican government bonds. The original allegations of that suit are detailed in our post here.
Specifically, Judge Oetken’s September 30, 2019, decision (found here) found that Plaintiffs’ complaint failed to allege facts that “plausibly suggest that the particular defendants named in this suit were part of . . . [the alleged] conspiracy.” In other words, the court found that the Complaint lacked individualized allegations as to each defendant, and instead treated all defendants as one by relying on impermissible “group pleading.” For example, the Court found that the participation by one of the defendant banks (left unnamed in the complaint) in the leniency program of Mexico’s antitrust regulator, the Comisión Federal de Competencia Económica (“COFECE”) and public reports that COFECE was investigating the banks as each insufficient to plausibly suggest wrongdoing by the particular defendants named in the complaint. Continue reading Plaintiffs in Mexican Bond Market Fixing Case Seek Time To Amend, Citing New Evidence

Reuters, Bloomberg, and Law360 are reporting that S.D.N.Y. Judge Paul Oetken has dismissed an anti-trust lawsuit alleging that 10 major banks, including JP Morgan Chase, Barclays, and Deutsche Bank, colluded to inflate the price of Mexican government bonds. The court found that the complaint lacked particularized allegations with regard to any of the defendants and instead relied on impermissible “group pleading.” The plaintiffs have 21 days to request leave to file an amended complaint. Continue reading Court Dismisses Mexican Bond Price Fixing Suit

The New York Times is reporting (via Reuters) that Judge Jed Rakoff of the United States District Court for the Southern District of New York has ruled that an anti-trust action alleging price-fixing of Fannie Mae and Freddie Mac bonds can proceed against Goldman Sachs, Deutsche Bank, BNP Paribas, Morgan Stanley, and Merrill Lynch. Judge Rakoff’s decision was based upon chat-room evidence of coordination he described as “direct” and “smoking gun.” Eleven other banks that were not implicated in the chats were dismissed, including TD Bank, Barclays, and Citigroup, but the plaintiffs have been given an opportunity to plead additional facts to bring them back into the action. Continue reading Fannie Mae Bond-Fixing Suit To Proceed Against Goldman Sachs And Others

On March 22, 2019, the Ohio Carpenters’ Pension Fund filed a proposed antitrust class action in the Southern District of New York. The complaint alleges that Bank of America and NatWest (f/k/a RBS) conspired to rig the bid-ask spreads of Eurozone government bonds between 2007 and 2012. The complaint specifically alleges that the defendants were (nominally) competing “primary dealers” for the sale of the bonds to investors, but that they colluded to increase their bid-ask spread collectively in order to avoid competitive disadvantage and potential loss of the issuers’ business. Continue reading Lawsuits Filed Over Eurozone Bond Bid-Ask Rigging

You know what else is new to these parts? Government-Sponsored Enterprises! Yes friends, this is the start of a brand-new miniseries here on the Manipulation Monitor. In this series, I’ll be tracking the ins and outs of several new litigations against the “usual customers” (read: the big banks), this time in their roles as horizontal competitors and dominant dealers of bonds issued by Government-Sponsored Enterprises, or GSEs. Complaints to date include the following: Continue reading SOS to GSEs: Your Bonds are A Beautiful Mess

On February 22, 2019, the City of Birmingham’s pension fund and various other benefit funds filed a proposed antitrust class action in the Southern District of New York. The complaint alleges that a number of major banks–Bank of America, Barclays, BNP Paribas, Credit Suisse, Merrill Lynch, Citigroup, Goldman Sachs, and Deutsche Bank, among others–conspired to manipulate the secondary market for unsecured bonds issued by Fannie Mae and Freddie Mac between 2009 and 2014. The defendants are the largest dealers in the $550 billion over-the-counter secondary markets, and the complaint alleges that they colluded among themselves to inflate the prices of bonds they sold and to deflate the prices of bonds they repurchased from investors, including the institutional investors who are the lead plaintiffs. Interestingly, the complaint relies on the fact that the bid-ask prices changed dramatically in April 2014 after the banks came under additional scrutiny due to the LIBOR manipulation scandal. The complaint also alleges that this conduct is the subject of an ongoing Department of Justice investigation. The SDNY antitrust action is before Judge Jed Rakoff. Continue reading Antitrust Suit Alleges That Major Banks Colluded To Manipulate Prices Of Fannie & Freddie Bonds Between 2009 And 2014

Last week, the City of Philadelphia filed a proposed antitrust class action in the Southern District of New York. The action alleges that a number of major banks–Bank of America, Merrill Lynch, Citibank, Goldman Sachs etc.–conspired to artificially inflate the interest rates for a type of tax-free municipal bonds called Variable Rate Demand Obligations (VRDOs). Continue reading City of Philadelphia Files Anti-Trust Class Action Arising From Whistleblower Allegations That Banks Fixed VRDO Interest Rates