Inquiry into Silver Manipulation Will Likely Be Dropped

A four-year investigation into potential manipulation in the silver futures market will likely be scrapped, sources familiar with the situation told

. The sources said that regulators have not been able to find enough evidence to bring a case. The investigation began in 2008 after the Commodity Futures Trading Commission announced that it was looking into “complaints of misconduct in the silver market" made by numerous market participants. In 2010, CFTC commissioner Bart Chilton said that he believed there had been "fraudulent efforts" to "deviously control" silver prices. According to CNBC, however, CFTC staff do not currently believe they have enough evidence to make a case. The regulators have taken advice from two external consultancies, CNBC reported. The agency has not officially announced the end of the investigation. “The investigation has not reached its conclusion," said a CFTC spokesman to CNBC. The probe centered around a number of large investment banks, including JPMorgan

. Silver traders have repeatedly accused the firm's traders of manipulating the price of silver around key economic announcements. CNBC reported that the CFTC has analyzed over 100,000 documents and interviewed dozens of witnesses since it began investigating the alleged manipulation. Although the probe did not name any companies or individuals, the most aggressive accusations have been made against JPMorgan commodity traders as well as traders at HSBC. Blythe Masters, head of JPMorgan's commodities unit, has repeatedly denied the accusations against her firm, which have been prevalent on the Internet. She told CNBC in April that “We have no stake in whether prices rise or decline,” in discussing the rumors about the firm being behind manipulative silver trading. In April 2011, silver prices capped a massive bull rally by topping out at just under $50.00. The move in prices was driven in part by wide spread speculation that JPMorgan was heavily short the market. Subsequently, prices have fallen sharply and closed Monday's trading session at $27.855.