GATA'S Reg Howe Sues BIS, FED, Treasury, and 5 Investment Houses To Stop Gold Price Suppression
For Release at 8 a.m. EDT Monday, December 11, 2000
A lawsuit filed in U.S. District Court in Boston with the support of the Gold Anti-Trust Action Committee accuses five investment houses, the Bank for International Settlements, and top officials of the U.S. Treasury Department and U.S. Federal Reserve Board of conspiring to suppress the price of gold.
The lawsuit, Docket No. 00-CV-12485-RCL, charges the defendants with price fixing, securities fraud, and breach of fiduciary duty. The U.S. government officials are also accused of exceeding their constitutional authority.
The lawsuit's plaintiff is Reginald H. Howe, a lawyer, gold market analyst, consultant to GATA, proprietor of an Internet site devoted to gold market commentary (www.GoldenSextant.com), and a shareholder of the Bank for International Settlements. The BIS's plan to cancel those of its shares in private hands so that the bank might become owned entirely by member central banks is at the center of the lawsuit.
The suit alleges that the BIS proposes to pay its private shareholders substantially less than fair value for their shares. The suit also claims that the BIS, owner of a substantial amount of gold, has been at the center of a scheme with central banks and the investment house defendants to coordinate the sale and leasing of gold and the sale of gold derivatives to keep the price of gold low and thereby disguise inflation and weakness in the U.S. dollar, as well as to prevent losses on gold short positions held by certain banks.
Officials of the Federal Reserve Board have no authority to hold directorships of the BIS, the lawsuit alleges.
The suit seeks injunctions to stop the Treasury Department and the Fed from intervening in the gold market and to stop the investment houses from manipulating the price of gold; an order to the BIS to compensate its private shareholders fully; and damages against all the defendants for fixing the price of gold.
Besides the BIS, the defendants include: Alan Greenspan, chairman of the Federal Reserve Board; William J. McDonough, president of the Federal Reserve Bank of New York; Lawrence H. Summers, secretary of the Treasury Department; and J.P. Morgan & Co. Inc.,
Chase Manhattan Corp., Citigroup Inc., Goldman Sachs Group Inc., and Deutsche Bank AG.
The text of the lawsuit is posted on the Internet at:
"With this lawsuit, we hope to mobilize the gold mining industry and gold shareholders around the world to help us restore a free market," GATA Chairman Bill Murphy said. "Mining companies, their employees and shareholders, and developing countries have been ruined by the manipulation of the gold market, and it has prompted ordinary investors around the world to put their savings at greater risk than they would have done otherwise. Meanwhile certain Wall Street interests have made billions from this manipulation. GATA was founded to fight this, and fighting it we are.
"But sustaining this lawsuit against defendants that control most of the world's money will cost money itself, and we continue to appeal to gold's friends for financial contributions to support our work."
GATA is a educational and charitable organization incorporated in Delaware. Contributions are federally tax-exempt in the United States and may be sent to GATA in care of Chris Powell, Secretary/Treasurer, 7 Villa Louisa Road, Manchester, Conn. 06043-7541 USA. (Email: GATAComm@aol.com.)
Murphy may be reached by telephone in Dallas, Texas, at 214-522-3411, and by electronic mail at LePatron@LeMetropoleCafe.com.