News & Analysis as of

First Guilty Verdict for Dodd-Frank “Spoofing” Violations

Coscia, the founder of Panther Energy, LLC, allegedly created two computer algorithms that posted orders to the Chicago Mercantile Exchange and ICE Futures Europe with the goal of canceling them before they could be executed....more

Prosecutors Record First-Ever Conviction for ‘Spoofing’: A New Era of Trading Enforcement

Asset managers and other traders should expect aggressive anti-spoofing enforcement and consider reviewing their trading practices in light of this most recent development. On November 3, 2015, a federal jury in...more

Bridging the Week - October 2015 #4

Proposed Automated Trading Rule by CFTC Likely to Follow Already Existing Best Practices; SEC Also Contemplating New Measures - In two speeches last week, Timothy Massad, Chairman of the Commodity Futures Trading...more

CFTC Accuses Firm Manually Entering Orders Of Spoofing Scheme That Fooled Algorithmic Traders

Potentially abusive trading algorithms, such as algorithms that purportedly engage in “spoofing” or “layering” are the subject of considerable regulatory interest. However, in an interesting complaint filed on October 19,...more

Bridging the Week - October 2015 #3

Three Individuals Fined and Banned From Trading on CME Group Exchanges for Market Conduct Violations - CME Group business conduct committees permanently banned three traders from trading on CME Group exchanges for market...more

Bridging the Week - October 2015 #2

SEC-Sanctioned Trader Began Alleged Spoofing After Complaining About Spoofing by Others to NYSE - Eric Oscher and Briargate Trading, LLC, a company 50 percent owned by Mr. Oscher, agreed to pay an aggregate fine of US...more

This Week In Securities Litigation

The PCAOB filed a settled action involving an auditing firm in which the consent order of settlement was based on admissions of facts. The approach is similar to the one adopted by the SEC in which the Commission requires...more

Bridging the Week - September 2015 #2

CFTC Says Virtual Currencies Are a “Commodity” Under Federal Law, Files Charges Against Coinflip for Operating an Unregistered Bitcoin Options Trading Platform - The Commodity Futures Trading Commission filed and...more

Bridging the Week - September 2015

Alleged Flash Crasher's Formal Indictment Provides More Details Regarding His Purported Spoofing - The US Department of Justice filed a formal indictment against Navinder Singh Sarao in a US federal court in Chicago on...more

Case Note: Market Abuse Proceedings in the High Court

The judgment in The Financial Conduct Authority v. Da Vinci Invest Limited [2015] EWHC 2401 (Ch) was published on 12 August 2015, following a trial in front of Mr Justice Snowden. The case concerned allegations that the...more

FCC Announces Robocalling and Caller ID Spoofing Workshop

Telemarketers and others who may have been wondering how the Federal Communications Commission’s recent and – to industry participants – concerning Declaratory Ruling and Order on the Telephone Consumer Protection Act (TCPA)...more

Bridging the Week - August 2015 #2

ESMA Says “No for Now” to Granting Passport Rights to US Fund Managers Under AIFMD - The European Securities and Markets Authority told the European Commission last week that it was premature to grant passport rights to...more

The US Government’s Charge Against “Spoofing”

Asset managers should consider the practical implications of these recent developments. Signaling a new area of criminal and civil securities enforcement, federal regulators are flexing their newly acquired powers under...more

The Financial Report - Volume 4, No. 10 • May 2015 (Global)

Discussion and Analysis - One of the earliest, and certainly one of the most famous, computers of all time is HAL 9000, the sentient computer that controls the systems of the Discovery One spacecraft and interacts with...more

Bridging the Week - May 2015 #2

Two Traders Subject of CME Summary Suspension for Alleged Spoofing Sued by CFTC Too - Last week, the Commodity Futures Trading Commission commenced a lawsuit in federal court in New York against Heet Khara and Nasim...more

Bridging the Week - May 2015

CME Group Summarily Suspends Trading Privileges of Two Traders Without Hearing for Alleged Spoofing and Non-Cooperation - Less than two weeks after civil and criminal charges were filed by the Commodity Futures Trading...more

Judge Declines to Dismiss Spoofing Charges Against High Frequency Trader

On April 16, the US District Court for the Northern District of Illinois denied a motion to dismiss “spoofing” charges against Michael Coscia, a high-frequency commodities futures trader, finding that the indictment was...more

Bridging the Week - April 2015 #3

CFTC Commissioner Bowen Argues for User Fees During House Subcommittee Hearing; Commissioner Wetjen Calls for Bankruptcy Law Amendments to Permit Individual Segregation of Customer Funds - Commodity Futures Trading...more

Dodd-Frank Anti-Spoofing Statute Not Void for Vagueness For High Frequency Trader

In United States v. Coscia, the District Court for the Northern District of Illinois Eastern Division declined to dismiss an indictment for “spoofing” against a high frequency trader under 7 U.S.C. §§ 6c(a)(5)(C) and 13(a)(2)...more

Bridging the Week - January 2015 #3

Cybersecurity, Potential Equity Order Routing Conflicts and AML Among the Top Examination Priorities for SEC in 2015 - The Securities and Exchange Commission’s Office of Compliance Inspections and Examinations...more

SEC-USAO File Actions On “Old Fashioned” Spoofing Scheme

Spoofing or layering is typically associated these days with computers and high speed trading. It is a form of market manipulation in which the trader places a series of fictitious orders on one side of the market to draw...more

Bridging the Week - December 2014 #4

ESMA Publishes Implementing Rules for MiFID II - The European Securities and Markets Authority issued its final technical advice and initiated a consultation regarding proposed regulatory and technical standards...more

Spoofing Back in the News — First Criminal Indictment for Spoofing; CFTC Settlement Lays Out Telltale Signs of Spoofing

Last week the government handed down its first criminal indictment for allegedly engaging in “spoofing” and the Commodity Futures Trading Commission settled with Eric Moncada for spoofing. Spoofing is a form of trading in...more

First Criminal Prosecution for Spoofing: High Frequency Trading Firm Owner Indicted in Northern District of Illinois

On October 2, 2014, the U.S. Attorney for the Northern District of Illinois announced the indictment of Michael Coscia, the owner of Panther Energy Trading (“Panther”), for six counts of commodities fraud and six counts of...more

High-Speed Trader Indicted for ‘Spoofing’

A federal grand jury in Chicago recently indicted high-frequency trader Michael J. Coscia for “spoofing,” making it the first criminal case ever brought under the Dodd-Frank Act’s rules against disruptive trading practices....more

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