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GATA featured in major German newspaper

Section: Daily Dispatches

Gold 'plot' seems to hold more bull than bullion

By Ingrid Salgado
Business Report, South Africa
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May 13, 2001

DURBAN -- Outspoken supporters of the Gold Anti-Trust
Action Committee (GATA), the Texas-based group that
believes the world's central banks are colluding to
squash the gold price, are few and far between.

So it was hardly surprising that not a single South
African mining house, African government, or trade
unionist was prepared this week to openly back the men
who believe gold-producing African countries have
suffered at the hands of the world's biggest bullion

Led by chairman Bill Murphy, the self-styled modern-day
Robin Hood, GATA arrived in South Africa this week to
tout its theory that central banks are manipulating the
gold price to stall the fallout from alleged excessive
lending of their bullion reserves to top trading

Murphy lectured on Thursday that Africans quot;deserve to
know the truthquot; about a scandal that would make the
U.S. Watergate presidential disgrace quot;look like child's

Listening to the speeches that were peppered with
phrases like quot;this cannot be coincidence,quot; quot;Clinton
administration scandal,quot; and quot;hypocrisy of the most
outlandish orderquot; were representatives of mining houses
Anglogold, Goldfields, and Durban Roodepoort Deep, the
National Union of Mineworkers (NUM), and the
governments of South Africa, Ivory Coast, Ghana, and

But while GATA was able to attract an array of
executives to its seminar, it was less successful at
holding their attention.

quot;We've heard this all from GATA before,quot; said one gold
producer. quot;They're presenting no new evidence.quot;

This opinion was best illustrated by the intermittent
snores of a U.S. businessman during a dry lecture given
by Reginald Howe, the lawyer who is leading GATA's
court action against Alan Greenspan, U.S. Federal
Reserve chairman, and others.

The lawsuit is highly complex but, in a nutshell, Howe
is seeking damages for the private shares he held in
the Bank for International Settlements (BIS) that were
repurchased by the bank. GATA claims that the BIS, as
the central bank of central banks, has facilitated the
bullion borrowings at the centre of its price-fixing

The action has been launched in the Massachusetts
district court against the BIS, Greenspan, and
investment houses J.P. Morgan and Chase Manhattan
(which have since merged), as well as Citigroup,
Goldman Sachs, and Deutsche Bank.

The court papers cite Anglogold and Canada's Barrick
Gold, the world's biggest gold producers, as having
quot;material knowledgequot; of the bullion banks' alleged
price fixing.

Steve Lenahan, an Anglogold executive who attended
GATA's summit, said: quot;We know there's an element in the
court papers which is absolutely wrong, and it makes us
question all the other assertions made by GATA in
general and Mr. Howe in particular, because it's
asserted with the same authority.quot;

Ironic, then, that Anglogold was among the South
African mining houses that donated funds to GATA when
it was formed two years ago.

Lenahan said Anglogold had endorsed GATA's call for
greater transparency in the flows of gold in official
sectors. quot;But we don't draw the same conclusions from
their assertions. We see no evidence at all for
manipulation of the price of gold.quot;

Other gold producers, although concerned at unusual
movements in the price of bullion over the last five
years, are believed to be reluctant to throw their
weight behind GATA because of the potential fallout
should GATA's court action fail.

According to Gino Govender, strategy co-ordinator for
the NUM, it would be quot;difficult for us to say whether
they [GATA] are right.quot;

quot;They certainly have a compelling argument. If their
theory is true, it augurs well for the gold mining
industry of South Africa.quot;

This potential for a gold rally is what GATA has
emphasized in its efforts to pull in African nations as
allies against the world's most powerful institutions.

That the plan to take on the Fed is being launched from
Durban seems somewhat odd. But Murphy refers to GATA's
quot;battle planquot; being based on the quot;enveloping hornquot;
strategy favoured by quot;one of Africa's greatest
generals,quot; King Shaka.

And, said Murphy, he had enlisted the support of the
Zulu royal family after meeting King Goodwill
Zwelithini on a previous visit.

This led to meetings with Phumzile Mlambo-Ngcuka, the
minerals and energy minister, and the Reserve Bank.