RBA Attracts Investors with Sale of Banknotes

With the release of its “banknote sale” yesterday, the Reserve Bank of Australia may be raising an issue that the share market has long been trying to avoid.

These banknotes, which would be sold for a limited period only, were aimed to drum up investment interests. Some collectors may even try to purchase notes with signature combinations of the serial numbers.

But a guide published by the chaired Australian Securities and Investments Commission warned investors of possible scams, suspicious activities and “naughty behaviour” as a result of the release of these.

The guide had tables that showed how insider trading and possible illegal activities could be carried out using banknotes. These trades can invariably affect the integrity of the market.

In some cases, an investor may seemingly want to get a significant volume of these notes to “attract liquidity on one side of the market,” according to one of the guides, only to cancel out on this the last minute.

The guide was published so that wrongdoings in the market can be avoided and traders would become aware of how easy it is to manipulate everything.

According to the guide, a market participant must decide on a case-by-case basis should there be reasonable and justifiable grounds to raise suspicions.