Gold fix operator picks committee to oversee spot price

Gold fix operator picks committee to oversee spot price

The London Gold Fixing Ltd has set up a new supervisory to oversee the pricing of the precious metal following a series of regulatory probes into price rigging.

The company’s new board is made up of compliance officers at the four banks that currently operate the gold “fix”, Reuters reports.

The near-century-old practice saw the banks set the price twice daily after telephone conferences, but will it now operate under more strict regulations.

London Gold Fixing Ltd has also put out requests for proposals to find a new company to administer the price benchmark.

The move comes amid heightened regulatory scrutiny of financial benchmarks, and follows a recent shake up to the silver fix.

The Chicago Mercantile Exchange (CME), which recently won the silver fix, has confirmed its intentions to bid for controlling the gold price setting process as well.

The industry has been pushing for a change as of late. Members of the World Gold Council met in London earlier this month to discuss the issue, but did not reach an agreement.

Financial benchmarks have come under strong scrutiny from regulators around Europe and the United States since 2012, when it became public that British banks had rigged the London Interbank Offered Rate (Libor).

In January Deutsche Bank announced its exit from the price-setting process, amid investigations by German regulators over suspected price manipulation.