On January 29, 2018, the U.S. Department of Justice and Commodity Futures Trading Commission announced enforcement actions against three banks and multiple individuals involved in alleged commodities fraud and spoofing schemes.
Each of the banks settled civil CFTC charges relating to manipulation of the price of precious metals futures contracts traded on the Commodity Exchange, Inc. through spoofing techniques (including placing an order with the intent to cancel before execution), and by trading in a manner designed to trigger customer stop-loss orders. The three banks were each ordered to pay a civil monetary penalty, which ranged from $1.6 million to $30 million. According to the orders, all three banks cooperated throughout their respective investigations.
Additionally, the DOJ and CFTC announced criminal and civil charges against various individuals. These individuals allegedly engaged in various spoofing and manipulative and deceptive schemes in various precious metals and other futures markets. In its continuing litigation, the CFTC is seeking a range of civil monetary penalties, disgorgement, and permanent injunctions against further violations of the Commodity Exchange Act and CFTC regulations, along with trading and registration bans for several of the individuals.
The DOJ's press release is available at: https://www.justice.gov/opa/pr/eight-individuals-charged-deceptive-trading-practices-executed-us-commodities-markets?_sm_au_=iVVB45PsTTVjRndM.
The CFTC's press release is available at: http://www.cftc.gov/PressRoom/PressReleases/pr7681-18.
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