Dow Jones - Judge To Review Claims In Gold Market Suit
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By FRANK BYRT
Dow Jones Newswires
November 6, 2001
BOSTON -- A federal judge said Monday he will take under advisement
claims brought in a civil suit that alleges U.S. banking officials,
the Bank for International Settlements, and five large investment banks
have conspired to keep gold prices low for their own benefit.
Reginald Howe, a Belmont, Mass., attorney who brought the suit,
and is representing himself in the case, claims that his investments
in the Bank for International Settlements and in Freeport-McMoran
Copper & Gold Inc. soured due to price fixing and other
"manipulative activities in the gold market from 1994 to the present time
orchestrated by government officials acting outside the scope of their legal
or constitutional authority and certain large bullion banks"
that participate in the over-the-counter gold derivatives markets
and on the Commodities Exchange (COMEX), in New York.
He filed the suit about two years ago.
Howe says he receives "financial and informational" support
in pursuing his claims from the Gold Anti-Trust Action Committee Inc.,
a Texas-based "civil rights and educational organization"
that was formed "to expose manipulation of the gold market
by certain bullion banks."
Howe said he serves as a consultant to that group and also runs
a Web site that provides information about gold markets and investing.
U.S. District Court Judge Reginald Lindsay clarified several issues
and dismissed a minor claim in a three-hour hearing Monday,
where the defendants presented motions to dismiss the lawsuit.
The judge is now expected to decide whether there is enough evidence
presented by Howe for the case to go forward to the discovery phase,
where Howe could force the defendants to produce evidence
and give testimony prior to a trial.
The judge didn't indicate when he would make a ruling on the matter.
George Henderson, an attorney representing the Department of the Treasury,
said Howe was using the suit to present his conspiratorial theories
without any concrete facts and that he has failed to present any
of his constitutional claims properly.
For example, he said the Treasury, which Howe named in his suit,
is not involved in a transactions involving gold or gold derivatives
and is not subject to the antitrust claims Howe made under
the Sherman Act. It can also claim the sovereign immunity defense,
and thus avoid Howe's damage claims.
Among those named as defendants in Howe's suit are:
the Bank for International Settlements, an international banking organization,
Federal Reserve Chairman Alan Greenspan, William McDonough, president
of the Federal Reserve Bank of New York, and Lawrence Summers,
former secretary of the treasury.
Bullion banks are banks that make a market in gold and gold derivatives.
The ones named in Howe's suit are: Citigroup Inc. (C),
Goldman Sachs Group Inc.(GS), Deutsche Bank AG (DB),
and J.P. Morgan Chase & Co. (JPM).
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