| Financial services watchdogs take flak from MPs
Members of Parliaments Finance Committee say industry regulators are failing to do their duty after hearing from the Ombudsman for Financial Services Providers Charles Pillai about the massive fraud perpetuated by the directors of the Leaderguard group of companies.
A report in Business Report says Leaderguard Securities went into liquidation after losing more than R300m of investors money in fraudulent foreign currency transactions. According to Pillai, three directors of the company pleaded guilty to fraud charges in Mauritius and each paid a fine of 400 000 Mauritian rupees (R91 000). No action has been taken against them in SA. They are all still walking around, having a wonderful life. It looks like crime pays in SA, Eugene Oakes, an internal advisor with the ombudsmans office, told MPs.
China's central bank deputy chief says capital to be released slowly
China's central bank will gradually ease restrictions on capital flows in a renewed effort to curb its huge trade surplus, according to Wu Xiaoling, deputy governor of the People's Bank of China. "China will ease cross-border capital transactions selectively and gradually under the precondition of effective risk prevention and intensified capital flow monitoring," Wu told a forum in Mumbai, India. She said the bank would broaden the overseas investment channels step by step, adding it was actively nurturing a foreign exchange market to provide more investment instruments for foreign currency holders. The government would also take more measures to boost domestic demand and persuade domestic businesses to import and invest overseas, she said.
Brits abroad stung with millions in credit card charges
British holidaymakers will be charged £355 million when they use their credit cards overseas this year, according to new research from uSwitch.com, the independent price comparison and switching website.
uSwitch.com estimates that UK consumers will be charged £204 million on credit card purchases and £151 million withdrawing foreign currency with their credit cards from cash machines.
Banks and credit card companies hit consumers each time they use their cards to make purchases and withdraw cash overseas with the following charges:
Exchange-rate loading fees – the average fee is 2.61% in the USA and 2.59% in Europe, this is added on to credit and debit card transactions (purchases and withdrawals) made overseas by most credit and debit card companies.
Transactions on forex market hit record high in February
The interbank forex market set a new record in the volume of transactions for February with 22.5 billion euros, four times higher than the monthly average of 2004 and 62% higher than the monthly average of 2006, according to the NBR data. "A significant share" of the volume traded on the forex market is due to speculative capitals the central bank believes.
The volume of foreign currency transactions exceeded NBR's foreign currency reserve (21.6 billion euros) for the first time in February.
After a sudden adjustment in September and October 2006, right after the full convertibility of the RON was announced, the inflows of foreign capital have supported a constantly upward trend of trading volumes. .
Mexico to Sell Warrants to Allow Swap of Foreign Debt (Update3)
March 13 (Bloomberg) -- Mexico plans to sell securities that will allow investors to swap bonds denominated in foreign currencies for peso debt, part of a push to make the country's finances less vulnerable to declines in the currency. Investors who buy the Mexican warrants will be able to exchange bonds in dollars, euros, German marks and Italian liras that are due between 2008 and 2033 for peso-denominated bonds maturing in 2014 and 2024, according to investors who received the terms of the proposal. This is the second time Mexico uses warrants, which allows investors to make money as the yield gap between the government's foreign-currency bonds and peso bonds narrows, to help attract investment to its local bond market. Last year, investors exchanged about $2.9 billion in foreign currency debt for peso bonds in four separate transactions.
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