Andre Flotron, a former precious metals trader for UBS AG, has been ordered to pay $100,000 and faces a one-year trading ban after being found guilty of spoofing and market manipulation, the Commodity Futures Trading Commission (CFTC) announced February 7, 2019.
The judgment, issued by Judge Vanessa Bryant of the U.S. District Court for the District of Connecticut on February 5, 2019, stems from a complaint filed by the CFTC on January 26, 2018. The investigation revealed that between August 2008 and November 2013, while employed by UBS, Flotron engaged in a scheme to manipulate precious metals futures markets.
According to the CFTC, Flotron placed large orders – known as “spoof orders” – with no intention of actually executing them. These orders were designed to create a false impression of increased buying or selling pressure in the market, tricking other traders into reacting to the fabricated supply or demand. He then exploited these reactions to profit from smaller, legitimate orders he had placed simultaneously on the opposite side of the market.
“This case reflects our continued commitment to preserving the integrity of our markets — like the precious metals markets at issue here — and to rooting out unlawful practices like spoofing,” said James McDonald, CFTC Director of Enforcement. “As this case shows, we will continue to work vigorously to hold individuals accountable, and not just the companies that employ them, for misconduct in our markets.”
The CFTC’s investigation was conducted by the Division of Enforcement’s Spoofing Task Force, with contributions from Alben Weinstein, Brandon Wozniak, David Oakland, Sam Wasserman, Patryk J. Chudy, Lenel Hickson, Jr., and Manal M. Sultan.
Flotron’s penalty includes a $100,000 civil monetary penalty and a one-year ban from trading and registering with the CFTC. The case highlights the CFTC’s focus on individual accountability in market manipulation schemes.
Source: CFTC.gov
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