Swiss central banker dumped francs on eve of devaluation

Section:

Swiss National Bank Caves Over Chief's Dollar Deals

By The Associated Press
via Google News
Wednesday, January 4, 2012

http://www.google.com/hostednews/ap/article/ALeqM5jq0lw-tfNgrfg1ICuikmx9...

GENEVA -- After days of stonewalling, the Swiss National Bank gave in Wednesday to demands that it shed light on currency trades from its chief's personal account that netted fat profits as he led efforts to lower the Swiss franc's value.

The Swiss government, meanwhile, reiterated its support for bank chief Philipp Hildebrand amid growing disquiet over the possibility that the private dollar deals unfairly earned his family tens of thousands of francs or dollars.

The Swiss National Bank decided to publish a report by external auditors PricewaterhouseCoopers and release its previously secret guidelines for senior officials. The move came only hours after the Swiss political weekly Weltwoche claimed that Hildebrand had personally authorized the currency deals previously thought to have been conducted by his wife.

"The report by PWC shows that recent reports in certain media about the transactions of the Hildebrand family are partly incorrect and contain no information that wasn't already known to the controlling authorities," the central bank said in a statement.

... Dispatch continues below ...



ADVERTISEMENT

Sona Discovers Potential High-Grade Gold Mineralization
at Blackdome in British Columbia -- 13.6g over 1.5 Meters

From a Company Press Release
November 22, 2011

VANCOUVER, British Columbia -- With its latest surface diamond drilling program at its 100-percent-owned, formerly producing Blackdome gold mine in southern British Columbia, Sona Resources Corp. has discovered a potentially high-grade gold-mineralized area, with one hole intersecting 13.6 grams of gold in 1.5 meters of core drilling.

"We intersected a promising new mineralized zone, and we feel optimistic about the assay results," says Sona's president and CEO, John P. Thompson. "We have undertaken an aggressive exploration program that has tested a number of target zones. Our discovery of this new gold-bearing structure is significant, and it represents a positive development for the company."

Sona aims to bring its permitted Blackdome mill back into production over the next year and a half, at a rate of 200 tonnes per day, with feed from the formerly producing Blackdome mine and the nearby Elizabeth gold deposit property. A positive preliminary economic assessment by Micon International Ltd., based on a gold price of $950 per ounce over eight years, has estimated a cash cost of $208 per tonne milled, or $686 per gold ounce recovered.

For the company's complete press release, please visit:

http://www.sonaresources.com/_resources/news/SONA_NR18_2011-opt.pdf



Like most central banks, the SNB forbids senior officials from engaging in personal trading where they might profit from insider knowledge about an upcoming monetary policy decision.

A key question is whether the trades were done by the bank chief or his wife Kashya, a former currency trader, and whether Hildebrand knew of them.

The Zurich-based Weltwoche weekly said it had obtained bank statements showing that Hildebrand himself bought large amounts of U.S. dollars before selling them for profit.

"We have all the bank statements showing the relevant transactions, plus a verbal assurance from a bank employee confirming that it was Hildebrand personally, not his wife, who ordered the transactions," Weltwoche's Deputy Editor-in-Chief Philipp Gut told The Associated Press in a telephone interview.

Gut declined to identify the bank employee, but said he was a client adviser at Bank Sarasin. The Basel-based private bank said it has fired an IT support employee who leaked confidential information about "currency transactions by the family" of Hildebrand.

The audit report released by the bank Wednesday cites emails indicating it was Kashya who used 400,000 francs to purchase 504,000 U.S. dollars on Aug. 15 -- informing her husband only a day after the transaction occurred. The audit report doesn't say whether she was aware of the SNB's currency plans, nor whether it was Hildebrand or his wife who, less than two months later, sold $516,000 for 475,000 Swiss francs.

The trade seemed to earn the Hildebrands almost 75,000 Swiss francs ($83,000) because between the purchase and the sale of U.S. currency, the Swiss National Bank had increased franc liquidity and set the minimum exchange rate of the euro at 1.20 Swiss francs. The two actions helped to sharply raise the value of major currencies like the dollar against the franc.

Auditors concluded that the cheap purchase of U.S. dollars two days before the SNB's liquidity decision Aug. 17 was "delicate," but since Hildebrand had declared the transaction a day earlier, he hadn't breached any rules.

On the sale of U.S. dollars, the auditors concluded it was part of a property deal that began in March. They decided that because Hildebrand had held almost $1.2 million from the deal for over six months, he also didn't breach SNB rules with the Oct. 4 dollar sale and in fact lost money in the exchange.

The Swiss government, meanwhile, issued a statement Wednesday saying it had discussed the affair with Hildebrand at a Cabinet meeting Dec. 23.

"The Federal Council sees no reasons to question the outcome of the audit. It has pronounced its support for Mr. Hildebrand," the government said.

Media commentators and lawmakers had urged greater transparency from the SNB and from Hildebrand, 48, whose unblemished image is considered crucial to the credibility of Switzerland's small but powerful central bank. Hildebrand has scheduled a news conference for Thursday.

Weltwoche, which published the latest allegations against Hildebrand, is close to the nationalist Swiss People's Party and its prominent billionaire backer, former Justice Minister Christoph Blocher.

Bank Sarasin said in a statement late Tuesday the fired IT support specialist passed details of the Hildebrands' account to a People's Party lawyer, who then arranged a meeting with Blocher.

Blocher, who has repeatedly criticized Hildebrand's management of the central bank, said through his spokesman he had no plans to comment on the case.

* * *

Join GATA here:

Vancouver Resource Investment Conference
Sunday-Monday, January 22-23, 2012
Vancouver Convention Centre West
Vancouver, British Columbia, Canada

http://cambridgehouse.com/conference-details/vancouver-resource-investme...

California Investment Conference
Saturday-Sunday, February 11-12, 2012
Hyatt Grand Champions Resort
Indian Wells, California, USA

http://cambridgehouse.com/conference-details/california-investment-confe...

Support GATA by purchasing gold and silver commemorative coins:

https://www.amsterdamgold.eu/gata/index.asp?BiD=12

Or by purchasing a colorful GATA T-shirt:

http://gata.org/tshirts

Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

http://gata.org/node/wallstreetjournal

Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon:

http://www.goldrush21.com/

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

http://www.gata.org

To contribute to GATA, please visit:

http://www.gata.org/node/16



ADVERTISEMENT

Prophecy Drills 384.9 Meters Grading 0.623 g/t PGM+Au,
0.3% Ni, 0.15% Cu (0.45% NiEq) From Surface At Yukon Wellgreen Project

Company Press Release
Thursday, December 8, 2011

VANCOUVER, British Columbia -- Prophecy Platinum Corp. (TSX-V: NKL, OTC-QX: PNIKF, Frankfurt: P94P) has announced the final drill results from 2011 drilling at the company's fully owned Wellgreen platinum group metals, nickel, and copper project in the Yukon Territory.

Borehole WS11-192 intercepted 384.9 meters of 0.45 percent nickel equivalent starting from 9.45 meters depth. Included in this greater interval of continuous mineralization is a platinum group metals-rich zone with a combined platinum-palladium-gold grade of 1.358 grams per ton over 19.23 meters (nickel equivalent 0.74%).

The final drilling results for 2011 have shown the Wellgreen Central-East and Central-West deposits to be one contiguous body, whereby there is good potential to broaden significantly the Central-West resource base, which currently contributes only about a quarter of the current 43-101 compliant resource at Wellgreen. Overall the drilling program met with good success in expanding the resource to the east and south. The long drill intercepts suggest the deposit remains very much open in those directions.

For the complete drilling results and the full company statement, please visit:

http://prophecyplat.com/news_2011_dec08_prophecy_platinum_wellgreen_dril...