Chicago-based proprietary trading firm Belvedere Trading LLC has been slapped with a $1.1 million penalty by the Commodity Futures Trading Commission (CFTC) for engaging in a pattern of spoofing in the E-mini S&P 500 futures market. The CFTC issued an order on September 30, 2019, detailing the charges and settlement.
The investigation revealed that Belvedere, through two of its traders, executed hundreds of instances of spoofing between June 2014 and February 2015, and again in October and November 2015, on the Chicago Mercantile Exchange (CME). Spoofing is a form of market manipulation where traders place orders with the intent to cancel them before execution, creating a false impression of supply or demand to manipulate prices.
The CFTC order mandates that Belvedere cease and desist from violating the spoofing prohibition outlined in the Commodity Exchange Act (CEA). While the firm admitted no wrongdoing, it agreed to the financial penalty and compliance measures to resolve the matter.
According to the CFTC, Belvedere received a reduced penalty due to its “early resolution” of the case. The agency acknowledged the firm’s cooperation in bringing the matter to a close.
The CME Group’s Market Regulation Department provided assistance during the CFTC’s investigation. The case was led by CFTC staff members Stephen Turley, Allison Sizemore, Rachel Hayes, Becky Jelinek, Chris Reed, Charles Marvine, and former staff member Peter Riggs.
This enforcement action underscores the CFTC’s commitment to maintaining the integrity of the futures markets and pursuing those who attempt to manipulate them for illicit gain.
Source: CFTC.gov
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