Former precious metals trader Christian Trunz has been charged with spoofing in the futures markets by the U.S. Commodity Futures Trading Commission (CFTC). The charges stem from a settlement reached after Trunz entered into a formal cooperation agreement with the CFTC’s Division of Enforcement.
The CFTC found that Trunz, a U.S. citizen residing in the United Kingdom, engaged in spoofing – the practice of placing orders with the intention of canceling them before execution – on thousands of occasions between 2007 and 2016. This activity occurred while he was employed at two New York banks.
According to the CFTC’s order, Trunz and colleagues placed these deceptive orders to manipulate other market participants into trading against orders they actually *wanted* filled. The goal was to artificially move futures contract prices, maximizing profits and minimizing losses for both Trunz and the banks he worked for. The investigation revealed Trunz learned the spoofing strategy from senior traders and implemented it with the approval of his supervisors.
The CFTC order mandates that Trunz cease and desist from violating the Commodity Exchange Act’s prohibition on spoofing. While the CFTC has reserved the right to determine sanctions against Trunz, his cooperation has been acknowledged and will be considered during that process.
Notably, Trunz has already pleaded guilty in federal court to one count of spoofing and one count of conspiracy to commit spoofing (United States v. Trunz, No. 19-CR-375, E.D.N.Y.).
The CFTC acknowledged the assistance of the Department of Justice’s Fraud Section and the Federal Bureau of Investigation in this matter. The case was led by CFTC staff members Trevor Kokal, David C. Newman, Mark A. Picard, Steven I. Ringer, Jordon Grimm, Patrick Marquardt, Lenel Hickson, Jr., and Manal M. Sultan.
Source: CFTC.gov
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