Next Big Government Investigation: US Treasury Bond Auction Manipulation?

A public pension fund has sued twenty-two financial companies acting as primary dealers in U.S. Treasury securities charging them with a conspiracy to manipulate the auctions. Similar to the Forex, LIBOR and ISDAfix investigations, they are accused of using online chat rooms to share client information and coordinate transactions.

The lawsuit indicates that experts have analyzed the pricing of the Treasuries around the start of the DOJ probe of the LIBOR interest rate benchmark for manipulation. The analysis reportedly demonstrates a change in pricing that indicates an end to the manipulation due to a crackdown that may have

We’ve been talking about the possible emersion of a bond whistleblower due to future problems that will arise in bond market liquidity. However, we’ve focused less on the possibility of the emergence of an individual providing the government additional information of antitrust-like manipulation by investment banks after seeing what they have done in the other markets.

We’ve speculated internally that someone came forward to tell the government about the conduct happening in this area. The SEC and CFTC whistleblower programs pay rewards of 10 to 30 percent of the monetary sanctions. On the other hand, it may be that the government simply took the information that they received in discovery from the other investigations and was able to also find misconduct in this market.

Our CFTC whistleblower attorneys can assist you with answers to questions about this information as well as assistance reporting violations of the Commodity Exchange Act to the U.S. Government. To speak to an attorney, fill out our contact form or call 1-800-590-4116.

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