The Commodity Futures Trading Commission (CFTC) has filed a complaint against Gemini Trust Company, LLC, alleging the New York-based firm made false or misleading statements to the agency during the self-certification process for a bitcoin futures product. The complaint, filed in the U.S. District Court for the Southern District of New York, centers around communications between July and December 2017.
According to the CFTC, Gemini provided inaccurate or incomplete information regarding its trading platform and the “Gemini Bitcoin Auction,” which was intended to determine the spot price of bitcoin for the proposed futures contract. Specifically, the agency alleges Gemini failed to adequately disclose facts relevant to the potential for market manipulation of the Bitcoin Futures Contract.
The CFTC asserts that Gemini personnel either knew, or should have known, that the statements made to the agency were false or misleading. The proposed contract was significant as it would have been among the first digital asset futures contracts listed on a designated contract market, making the accuracy of information provided by Gemini crucial to the CFTC’s oversight responsibilities.
“Making false or misleading statements to the CFTC in connection with a futures product certification undermines the CFTC’s work to ensure the financial integrity of all transactions subject to the CEA, protect market participants, deter and prevent price manipulation, and promote responsible innovation and fair competition,” stated Acting Director of Enforcement Gretchen Lowe.
The CFTC is seeking disgorgement of any ill-gotten gains, civil monetary penalties, injunctions related to registration and trading, and a permanent injunction preventing further violations of the Commodity Exchange Act (CEA). The case is being pursued by Christopher Giglio, Trevor Kokal, David W. Oakland, Alejandra de Urioste, K. Brent Tomer, Lenel Hickson, Jr., Manal M. Sultan, and former Enforcement staff member Gates Hurand.
The CFTC encourages individuals with information regarding potential violations of commodity trading laws to report it to the Division of Enforcement.
Source: CFTC.gov
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