The Importance of The Deutsche Bank Silver Fix Lawsuit Settlement

Tue, Oct 18, 2016 - 10:10am

This post is intended to remind you that this case is not about the present and it's not about the $38MM dollars. Instead, the true significance of this lawsuit will be on display over the coming months and years as innumerable new class action lawsuits are filed against The Bullion Banks for their collective role in rigging and manipulating the precious metals markets.

First, some links. Here's the news item from yesterday released by Reuters and a comprehensive write-up from Zerohedge:

  • And here are two links from back in April to remind you of the case:

    The typical internet reaction I've seen thus far is this:

    A) This is only $38MM. Where's my money? I've lost a lot of money due to the metals being manipulated but I won't get any of this settlement and, because the dollar amount is so small, neither will anyone else.

    B) This is just another slap on the wrist. A paltry $38MM is a drop in the bucket for Deutschebank and they'll now skate along with the rest of The Banks.

    C) All of the manipulation conspiracy whackos are dead wrong. This case was just a nuisance and Deutschebank only agreed to settle so that the whole thing would just go away. Big corporations do this all the time so move along now. There's nothing to see here.


    The impact and future effects of this case are significant and real. Yes, $38MM is not a lot of money and the settlement will only be disbursed to those few who had participated in the class action. But go back up this page and listen to the interview that I did with The Daily Coin. This is the first time that a settlement has been reached in a precious metals price rigging lawsuit. It's also the first time that a Bank has agreed to turn state's evidence against the other Banks that rig the process. The two items ensure that the case against both HSBS and Scotia is being built and that they will soon be forced to settle, too. Already, a NY judge has allowed the case to proceed into legal discovery (subpoenas, depositions, documents, etc) for the first time ever.

    But the real story will be what comes next...A virtual avalanche of similar class action lawsuits, each alleging price manipulation and multi-million dollar plaintiff losses. Now that DB is "singing" and legal discovery is proceeding in this single case, the floodgates are truly open.

    So think of this from the point of view of a Bullion Bank. Not only are you getting squeezed by tight margins and limited physical supply in London, you're also deeply underwater on most of the Comex futures positions that you've shorted in New York. And now this...An almost endless stream of future lawsuits from investors around the world whom you've cheated and defrauded over the past 20 years! What do you think these Banks are going to do in response? Many to most of them will just simply exit the bullion banking business! Can you even comprehend the monumental change this would represent?

    Of course this is not going to happen over the next few days or weeks. Instead, a process like this will take months to play out which is WHY we felt the need for this post and reminder. Do not get caught up in the headline of just this one settlement and do not allow some Cartel shill to persuade you that this whole thing is meaningless.

    I can assure you that, in the future, when we look back on the rubble of what was "bullion banking", the date of April 13, 2016 will live in infamy. That was the day that the settlement was first announced and it was the day that The Bullion Banks' entire house of cards began to crumble under the weight of accumulated fraud, deceit and lies.

    Hang in there, my friend. We are winning.


    About the Author

    turd [at] tfmetalsreport [dot] com ()


    TF Metals fan
    Oct 18, 2016 - 10:16am


    Even though it is public it it still worth the effort! 

    Oct 18, 2016 - 10:20am


    Yeah the $38M is a pretty light slap on said wrist. lol


    Oct 18, 2016 - 10:21am

    DB settlement

    If they admit no "wrongdoing" or "criminal" fault will it be possible to sue other than a civil suit?

    Oct 18, 2016 - 10:24am


    Sorry Marchas, I couldn't help myself. The cookie made me take it.

    Oct 18, 2016 - 10:24am

    I plead the 5th

    or maybe I'll just take the 5th..

    Oct 18, 2016 - 10:25am

    Discovery !!!!

    It is all about discovery ! The legal opening of deep dark secrets and methods. This is where the light will kill the fungus. It will reveal the pure manipulative practices that are being used to enslave Billions of human beings through acceptance of debt as a viable monetary concept. 

    Their days are numbered and we here at TFMR have a front row seat in the gallery. Enjoy the show !

    Oct 18, 2016 - 10:29am

    guess this answers my question

    from zerohedge post

    "While the amount is tiny for the German bank, now that it is enshrined in case law, it will unleash dozens of similar class action lawsuits, each tweaked a little, and each demanding tens of millions from the gold and silver rigging banks.

    Vincent Briganti, a lawyer for the investors, said the deal provides "substantial monetary compensation plus cooperation from Deutsche Bank in the continued prosecution of this important case against the non-settling defendants."

    While the amount is tiny for the German bank, now that it is enshrined in case law, it will unleash dozens of similar class action lawsuits, each tweaked a little, and each demanding tens of millions from the gold and silver rigging banks

    Oct 18, 2016 - 10:37am

    What about JPM?

    My biggest concern about this is the total lack of involvement of JPM. Are we wrong about them being the linchpin to all the manipulation? Or are we just several steps removed from them still?

    Oct 18, 2016 - 10:40am


    things are heating up

    I agree Turd, we are winning.

    Just keep stacking friends.

    Oct 18, 2016 - 10:48am

    Yes JPM not included in suit

    I suspect that this is due to the time period involved in the lawsuit. Recall that, "London Silver Market Fixing Ltd" was in charge of the once daily Fix until 2014. At that point, they turned it over to...DB, HSBC and Scotia. See here:

    "The company that runs the London silver fixing, a benchmark dating back more than a century, will stop running the process after Deutsche Bank AG said two weeks ago that it was dropping out of the price-setting ritual.

    The London Silver Market Fixing Ltd. will stop administering the fixing on Aug. 14, it said today in a statement. Until then, Deutsche Bank, HSBC Holdings Plc and Bank of Nova Scotia will remain the three members of the company, which will liaise with the U.K. Financial Conduct Authority. Alternatives may be available. The London Bullion Market Association started a consultation and will work with the market, regulators and potential administrators."

    ChaCha Mars
    Oct 18, 2016 - 10:51am

    7th - Thank you for the reminder, Craig

    Forests, not trees! Thank you, Craig!

    All secrets are being revealed, including ours. Easy to take potshots at those whose sins are being exposed this week; what of my own? Are any of us 100% noble 100% of the time? How comfortable would I be with James O'Keefe following me around then posting a vid? 

    Yesterday I read "The Boxcar Children" aloud with some struggling young readers. The Boxcar kids had no beds so slept on pine needles. One of the children in our group said she and her siblings at an earlier time didn't have beds, either, so we talked about sleeping on the floor being good for our backs, with our circle doing stand-up demonstrations, then moved on to the next page. Their big worry this week though is not beds but about being blown up in their beds by the Russians as the start of WWIII. This is not rhetorical: If I can't explain what's so to my own siblings what do I say to these young children in words they understand?

    Blessings to everybody!

    Oct 18, 2016 - 11:08am

    Goldman Smashes Expectations As Trading, Prop Revenues Surge

    Goldman Smashes Expectations As Trading, Prop Revenues Surge, "Average" Employee Makes $322,607

    Comment: I'd like to see the details of just how and at who's expenses (US tax payers?) these massive profits were made... I'm willing to bet much of it came from gaming the system and free money supplied by the Fed.

    yukon123 JQuest
    Oct 18, 2016 - 11:09am
    Oct 18, 2016 - 11:20am

    Silver Arbitrage approaching Caution level

    how elastic is the system? some day we may find out.

    Apparently silver is pretty heavy relative to gold and can stand more arbitrage %, perhaps because the cost of transportation. When will the GSR change to a more realistic number?

    AGAU yukon123
    Oct 18, 2016 - 11:25am

    Ecuador ,Gold, Bonds and Goldman!!!!

    What could go wrong with that deal jeez I wonder how much the "success" of that stinking deal is predicated on shutting down wikileaks and Assange??

    The Ecuadorians should have signed that deal with Putin or China, oh wait! Maybe they don't want a "civil" war?

    Oct 18, 2016 - 11:26am

    There is More to This, of Course

    Mr. TF:

    Excellent points.

    And, consider as well that the Plaintiffs' class action counsel is a team formed by two EXCELLENT law firms with vast, deep resources:

    US District Judge Valerie E. Caproni appointed Quinn Emanuel Urquhart & Sullivan LLP and Berger & Montague PC as co-lead counsel to litigate a major class action lawsuit that alleges manipulation by the banks that conduct the gold fix in London.

    HSBC, Barclays, Société Générale and Scotia-Mocatta currently set the twice-daily gold fix, which has been in operation since September 12, 1919. Germany’s Deutsche Bank withdrew from the process earlier this year after failing to sell its seat.

    On March 3, Kevin Maher, a former gold trader from New York, filed the first lawsuit in the US District Court for the Southern District of New York. He alleges that the banks, since 2004, have “combined, conspired and agreed with one another” to manipulate gold prices and derivatives markets.

    “Usually large spikes in spot gold prices have consistently occurred during the afternoon gold fix. This statistical pattern was not observed prior to 2004, when Rothschild withdrew from the Gold Fix and Barclays took over Chairman. Such pattern is not explained by news flow, fundamental analysis or a priori explanation of how an efficient market operates,” Maher’s attorney claimed in documents.

    Since then numerous others have since lodged similar complaints. Judge Caproni has combined 27 claims into a single case that will be heard in New York.

    “Given that the putative class is challenging the conduct of five major banking institutions over a period of at least ten years, successful prosecution of this litigation will require a massive commitment of resources from interim class counsel,” said Judge Caproni when selecting the Quinn-Berger team, which has about 700 combined attorneys.

    In addition to their significant resources, this legal team has other advantages, the judge noted.

    “First, the Quinn-Berger team’s more creative approach in tying its requested attorneys’ fees to the size of any common fund weighs in its favour. The proposed structure more effectively aligns counsels’ incentives with those of the putative class,” Judge Caproni said.

    Second, with the exception of one associate, all of the Quinn Emanuel attorneys are based out of New York. And Berger & Montague’s attorneys are located in nearby Philadelphia. This is key given that the case will be heard in Manhattan.

    “Finally, London Gold Market Fixing Ltd. and two of its five members are headquartered in London. The Court thus expects that at least some discovery will take place in London. Quinn Emanuel’s twenty-seven London attorneys compared with no London presence for [the other candidate firms] will likely save costs for the putative class,” she added.

    “In light of this litigation’s scope, the resources available to the Quinn-Berger team, the location of their attorneys, and the proposed structure of their future requests for attorneys’ fees if they are successful, the Court concludes that the Quinn-Berger team is best able to represent the putative class,” the judge concluded.

    Daniel Brockett of Quinn, Emanuel, is a big hitter. Last year he broke records on a monster case. His strategy is simple: 

    The suit alleged that the banks colluded to block the emergence of exchange trading venues for credit default swaps. Unlike some other high-profile antitrust cases against the banks, the suit was not preceded by a government enforcement action, since the U.S. Department of Justice and the European Commission investigated the allegations but never issued indictments or fines.

    "We took this case against the background of the major antitrust enforcement agencies looking at this and not being able to do anything with it," Brockett said.

    The banks produced millions of pages of documents during the government investigation, which formed the basis of what Brockett called "an aggressive deposition protocol."

    "We zeroed in on some critical material they produced to the government and got a lot of damaging admissions during depositions," he said. "On the question of did they enter into a cartel, the evidence was pretty compelling."

    The banks initially presented a united front, he said, but as the case proceeded, a few banks decided to break away and agree to settle, and the rest followed suit within a few weeks.

    "Our strategy of picking off one or two and figuring the others would then come along worked to perfection," Brockett said.

    His attorneys fees on the monster case have created a HUGE war chest. ("Under the terms of the proposed settlement, the defendant banks will create a common fund of $1,864,650,000, which will be made available to class members. Attorney fees will not exceed 14 percent of the settlement fund."). 

    The bullion banks are, in short, sitting ducks. Guys like Dan are just getting warmed up.

    The lawyers will use DB's information which the terms of the settlement with DB mandated that DB turn over to the lawyers. The paltry $38 Million is appropriate, as too little an amount and the settlement does not get approved, and too great an amount would never result in DB agreeing to turn over information.

    Now that the lawyers have a road map, courtesy of DB, then they will use that road map and conduct electronic discovery into ALL of the communications from Societe Generale, Barclays and HSBC.

    The e-discovery protocols will take time to sort out, but the turn over of information from the bullion banks to Dan and his team is so monumental, so gigantic, and so epic, that I have serious disbelief that the banks will fight this case much longer. The banks have EVERYTHING to lose by turning over discovery, and NOTHING to gain, as once the cat is out of the bag, then all that information will be used in countless new lawsuits, and for all sorts of bankster markets that they manipulated. It will be epic.

    No way the banks let that discovery out. No way.

    The case will settle, almost certainly, for a huge, monstrous number.

    The winners will be the lawyers, of course, and the banks will slink away into the night, with no real repercussions other than some fiat digits changing hands. Will there be any real consequences? No way. Not until the fiat currency scheme ends.

    Only with gold in hand will the banks lose their power.

    So, while I agree with you wholeheartedly, I have a more reserved outlook on real reforms.

    Keep up the good work, my friend!
    Oct 18, 2016 - 11:27am

    Thanks TF

    Glad to be here and "in the know" on this, the most important macro driver of the precious metals "market."

    Oct 18, 2016 - 11:39am

    More to this

    Thank you CL, I was hoping you could weigh in on this.

    Oct 18, 2016 - 11:45am

    I have been super busy with work

    But I will do my best to keep posting updates as they seem important.

    Doople California Lawyer
    Oct 18, 2016 - 11:58am

    California Lawyer

    Your synopsis of what is going on is excellent. Thank you.

    California Lawyer
    Oct 18, 2016 - 12:00pm

    Thanks, Cal

    What about the prospect that we've maintained since April that this is just the opening of the floodgates? That now a nearly infinite number of new lawsuits will be filed and that these will simply swamp and overwhelm The Banks...creating massive settlement losses and, ultimately, leading them to quit the business.

    Oct 18, 2016 - 12:06pm

    being naive.....

    Unfortunately I must agree with CL that the release/allowing of discovery would seem unlikely to occur and that settlement will be the outcome. However, cannot a judge disallow settlement (a settlement) of a case if they feel it is harmful to the greater good ? This is what has been occurring for years now, cases settled with no admission of guilt, no-one going to jail, no/little discovery released to the public, just pittance fines and the carrying-on of status quo. 

    We need REAL leaders who will say "no more hiding behind fines and wrist-slap's". Judges and politicians need to get a backbone and stop playing footsie with these criminals !

    What a sap I am to think this might happen anytime soon.

    Oct 18, 2016 - 12:23pm

    There's a Reason...

    Bankster's don't go to prison....

    If they did they know the incarcerated criminals would start singing about ALL the crimes and details of what they've been involved with and the TOTALLY CORRUPT CB's and Federal Reserve can't let that happen!

    JMHO frown

    Oct 18, 2016 - 12:28pm

    bankers - Prison

    Any "mouthy" Bankers get the permanent "sleep" solution, administered by nail gun or flying lessons!!!

    Dyna mo hum
    Oct 18, 2016 - 12:36pm
    Angry Chef
    Oct 18, 2016 - 12:39pm

    38 M$$$$...

    Isn't that the entire Market Cap of Da Douche when there derivative book blows ???

    Keep a heads up for flying Bankers. I think we're in for a bumper year !!!

    J Siefert
    Oct 18, 2016 - 12:48pm

    Rothschild exited the Gold Market in April 2005

    I knew that somewhere down the line the crap would get splattered when Rothschild quit the gold market in 2005 after being in the business for hundreds of years.

    PS I bet that they have more than a few ounces of physical gold stored away in their vaults for the 'reset'.

    Oct 18, 2016 - 1:11pm


    Have you ever wondered if many of the PM accounts in current ETF's are actually CB and PPT accounts with massive short stop loss positions set up to manipulate (sell) at targets to assist in manipulating ETF's? Never forget they have unlimited cash....

    I'm far from being an expert, just trying to think like a criminal. wink

    Oct 18, 2016 - 1:42pm

    President Obama Takes Another 'Economic Victory Lap'

    Reminds me of Baghdad Bob.....wink

    Governments will say anything as they go down and lose power exposing their only weapon left is PROPAGANDA!

    Angry Chef
    Oct 18, 2016 - 3:30pm

    Rothchild Gold

    When Bob Chapman was alive he was quoted as saying that the Rothchild's were the largest private holders of Gold on the planet. His estimates put it between 24%-26% of the above ground Gold supply. This is why I contend that the day we return to "honest money" we need to be careful. These banksters have been around since Babylon. Are we just going to hand them the keys to the next 100 years by finally going back to a Gold standard ?

    Let's face it. They created the "fiat" money system. They know it's a ruse. It's not real. It's all fake. And in the meantime they buy up all the Gold/Silver. Prime Real estate. Art. Oil. Water etc.... All paid for by the people thru "usury". So when the collapse does eventually arrive. And you're friends and family are all starving. Be careful what the Devil offers as a solution.

    And whatever you do...don't get on the train.

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