Las Vegas resident Daniel Shak is facing charges of spoofing and market manipulation following a civil enforcement action filed by the Commodity Futures Trading Commission (CFTC) in the U.S. District Court for the District of Nevada. The CFTC alleges Shak engaged in deceptive practices in the gold and silver futures markets between February 2015 and March 2018.
According to the complaint, Shak repeatedly utilized a trading tactic known as “spoofing” – placing orders with no intention of executing them – to manipulate market prices. He allegedly entered large buy or sell orders for gold and silver futures contracts on the Commodity Exchange, Inc., and then cancelled those orders before they could be filled. Simultaneously, he placed orders on the opposite side of the market, aiming to capitalize on the false signals created by the spoof orders.
The CFTC contends that Shak’s actions were designed to mislead other market participants, creating the illusion of increased buying or selling pressure. This, in turn, allowed him to fill his legitimate orders more quickly, at more favorable prices, and in larger quantities than would have otherwise been possible. The agency asserts that Shak either intentionally or recklessly sent these false signals to gain an unfair advantage.
The CFTC is seeking civil monetary penalties, disgorgement of ill-gotten gains, a trading ban, and a permanent injunction against future violations of federal commodities laws. The agency emphasized its commitment to prosecuting manipulative conduct that threatens market integrity, as stated by Acting Division of Enforcement Director Gretchen Lowe.
The CFTC acknowledged the assistance of CME Group Inc. in the investigation, which was conducted by the agency’s Spoofing Task Force. Staff members Brian Hunt, James Holl III, Maura Viehmeyer, Erica Bodin, Elizabeth May, Jordon Grimm, and Rick Glaser were responsible for the case.
Source: CFTC.gov
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