Competition commissioner Tembinkosi Bonakele is not in the employ of the Guptas; and from what I have seen him write, he is not someone upon whose vote Jacob Zuma could rely. He is an authoritative, engaged and determined regulator, exactly the new-model South African public servant we need.
So when he brings, as he did on Wednesday, grave and detailed charges of foreign exchange collusion against 16 banks trading the rand against the US dollar, take him seriously. And if you’re the boss of Standard Bank, Absa or Investec (the local banks involved), you know you may have compromised and weakened your industry in arguably its greatest hour of need in 20 years.
Yet this is what I read on the front page of Business Day on Thursday as it reported the charges: "A spokesman for Investec said it would co-operate with the competition authorities. ‘Unfortunately, at this stage, we still do not have further details with respect to the nature of the investigation and are, thus, not able to comment on the matter’." Oh, really? Have you read the commission’s statements? What’s worse, Investec was the best of them.
Standard Bank had "No comment". Seriously, Sim Tshabalala and Ben Kruger?
But first prize goes to Absa: "A spokesman for Absa, who asked not to be named because of bank policy, declined to comment on its application for leniency." That had me rolling on the floor.
The forex collusion charges put the banks on the spot in a way the Gupta/Zuma alliance could barely have imagined in their wildest dreams. Not even Bell Pottinger, the Guptas’ UK public relations consigliere, could have contrived a circumstance so perfect.
Our system of creating and distributing wealth needs to show some moral fibre, some ability to self-correct. That means people in smart suits may need to go to jail here
It is going to take some real leadership to separate forex manipulation by the banks from the Gupta struggle for a bank account, the "white monopoly capital" charge now appropriated by Zuma (which will probably rob it of its appeal – he has that effect on the things he loves) and legislation to restructure the banking sector.
This will embolden Zuma to get rid of Finance Minister Pravin Gordhan, arguably the only man left in Cabinet who is willing to stand up for a sound banking industry.
I’m no expert on this stuff. As I understand it, the colluders would try to keep the spreads of the rates of the currencies they are trading as wide as possible. Got it? Go to any expensive hotel – they’ll buy your dollar for R10 and sell you one back for R20.
But widespread collusion is fraught. To reduce your risk you need to narrow the spread. Reducing risk, more than huge profit, is often the driving force behind collusion.
Forex manipulation is different to currency manipulation in intent, and to the construction cartel exposed four years ago, in that I do not believe that the clients who paid for football stadiums were not to varying degrees party to the fraud. We will see, if there is ever a trial.
And that, surely, is what is needed here now — a trial. The banks may well be heavily fined, but the people who actually did this need to be charged. The free market and a capitalist economy in a future SA is at stake.
Our system of creating and distributing wealth needs to show some moral fibre, some ability to self-correct. That means people in smart suits may need to go to jail here.
In the construction cartel case, the collusion was done by actual humans. Why have they never been charged?
Where are the Hawks, the "priority crimes unit"? Oh, sorry, I forgot … busy. Zuma bragged last week he had signed the criminalisation of collusion into law. This will be a test case.
Surely the first thing Investec, Standard Bank and Absa would do is suspend their heads of forex trading until the Competition Tribunal issues a judgment in the matter — and their deputies and assistants. Get to the point where you’re left with kids who don’t know how to collude or manipulate and we are probably safe.
The problem the banks have – and not just the ones named – is public opinion. If an ordinary man cannot be sure he can buy sterling at a fair rate to travel to London for the first time or if a US tourist here cannot be sure of a fair rate of exchange, then they won’t travel from and to SA. If our banks lose public trust, they (and the rest of us) are doomed. Who will save them?
The banks have been meek in the face of attack from the Gupta/Zuma coalition. Gordhan has taken all the flak for them. But he must not help them now. The banks need to remind us why they are important in our lives. They do that by being transparent and scrupulously honest.
About $60bn of rands are traded on the global forex market every day. Even a tiny fraction of that, minutely manipulated, would dwarf whatever the Guptas may have moved through their now closed accounts. What would Standard Bank or Absa be prepared to do to atone for losses to the public, possibly greater than any delinquent client could conceivably have managed to inflict?
• Bruce is editor-in-chief
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