The Commodity Futures Trading Commission (CFTC) announced a record judgment against JPMorgan Chase & Company and its subsidiaries. JPMorgan will pay out a record $920.2 million for a CFTC case, which includes the highest amounts of restitution, disgorgement and civil monetary amounts every for a “spoofing” case.
JPMorgan was accused of “manipulative and deceptive conduct and spoofing” over the course of at least eight year, including “hundreds of thousands of spoof orders” relating to precious metals and futures contracts.
The CFTC’s investigation found JPMorgan’s illegal trading activity benefited the company while harming other participants in the market, which led to the record judgment. The case was brought forth in conjunction with the Spoofing Task Force from the Division of Enforcement.
According to the case information, the illegal activity occurred from 2008 through 2016. During that time, JPMorgan allegedly placed hundreds of thousands of orders to purchase or sell gold, silver, palladium, platinum, Treasury note, and Treasury bond futures contracts, with an intent to cancel orders before execution. By using these so-called “spoof orders,” the traders purposefully inflated or deflated supply and demand to deceive other participants in the market into executing against other orders they wanted to file. The CFTC judgment indicated JPMorgan traders intentionally manipulated market prices, and succeeded in causing artificial prices.
The CFTC also determined JPMorgan failed to identify, investigate or stop the illegal conduct hat occurred.
For more information about the steps you should take if you become aware of fraudulent activity within your company and the federal protections afforded to whistleblowers, contact an experienced attorney at Kardell Law Group.