Lead South Africa

Cosatu lashes out at ‘self-serving’ politicians over bank corruption response

JOHANNESBURG – The Congress of SA Trade Unions (Cosatu) on Thursday described government and politicians’ reaction to looming prosecution of 17 banks colluding in alleged price fixing as a “self serving political theatre” and accused those in leadership of not reigning in on private sector corruption.

“It is dishonest for anyone to pretend as if this is the first time that the private sector has been found guilty of collusion and of engaging in economic sabotage,” the trade union federation said.

“All these hysterical political parties are part of the legislative arm of the state, they should have acted long ago to pass strict laws that would deal decisively with this collusion phenomenon if they were serious. They have done nothing to curb or do away with this economic vandalism.”

Cosatu said the reactions to the banks’s alleged collusion after a probe by the Competition Commission was similar to that for seven companies in the construction and steel sectors, who undertook to pay a R1.5 billion fine to the State for colluding over tendering processes during the massive build projects for the 2010 FIFA World Cup.

“All that the construction companies needed to do, was to tell government that they were prepared to contribute R1.5 billion for development projects and also committed to promote transformation and black participation and ownership in the sector, and they were free to move on with their businesses.”

“The response from government and many of these political parties was that this is just an ugly and unacceptable face of capitalism, and all we needed to do was to save capitalism from capitalists.”

The Organisation Undoing Tax Abuse (OUTA) welcomed the findings against the banks, but, however, shot down “knee-jerk reaction” for a state-owned bank in the wake of the scandal.

“While the State has every right to have a state-controlled Post Office to apply for banking license, if granted it would need to be operated independent of political interference and within a competitive environment, with no support from taxpayers’ funds. The laws and regulations which apply to all banks must apply equally to the state-controlled bank, to ensure exceptional governance and sustainability,” OUTA said.

The country’s Competition Commission said it had been investigating a case of price fixing and market allocation in the trading of foreign currency pairs involving the rand since April 2015.

It had found that from at least 2007, the banks had a general agreement to collude on prices for bids, offers and bid-offer spreads for the spot trades in relation to currency trading involving US Dollar/Rand currency pair.

Implicated banks included Africa’s Absa, Investec and Standard Bank. The commission has referred the matter to a tribunal for prosecution.

– African News Agency (ANA)

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