SUMMARY
This is AI generated summarization, which may have errors. For context, always refer to the full article.
One of the favorite hangouts of Singapore’s tight-knit group of currency traders was the Il Fiore (or The Flower), an easy-to-miss basement bar nicknamed “The Blackhole.” According to Reuters, traders played card games at this bar for over a decade, when they are not chatting through their trading terminals on how to make money by manipulating the currency rates via the non-deliverable forwards (NDF), a product that allows foreign investors and companies to hedge or speculate on emerging market currencies when exchange controls in those countries make it difficult to trade directly in the spot market. The spotlight was cast on this practice when Singapore began to review reference rates after the 2012 scandal in London where Barclays traders were found to have manipulated Libor, a lending benchmark used to price trillions of dollars of loans and derivatives. Singapore’s investigations show that the constant messaging among NDF traders often centered on the daily fixings. “It was like a rigged dice game, where the traders were changing the numbers on the dice when no-one was looking,” Reuters quotes a former foreign exchange dealer as saying.
Read more on Reuters
Image via Shutterstock
Add a comment
How does this make you feel?
There are no comments yet. Add your comment to start the conversation.