Chicago trader Igor Oystacher and his firm, 3Red Trading LLC, have been penalized by the Commodity Futures Trading Commission (CFTC) for engaging in a manipulative spoofing scheme spanning over two years. Judge Amy J. St. Eve of the U.S. District Court for the Northern District of Illinois issued a permanent injunction against Oystacher and 3Red on December 20, 2016, following a complaint filed in October 2015.
The CFTC alleged that Oystacher and 3Red repeatedly used a deceptive practice known as spoofing while trading E-Mini S&P 500, Copper, Crude Oil, Natural Gas, and VIX futures contracts across four major exchanges – the Chicago Mercantile Exchange (CME), New York Mercantile Exchange (NYMEX), Commodity Exchange Inc. (COMEX), and the CBOE Futures Exchange (CFE). The scheme involved placing large, passive orders with no intention of executing them, creating a false impression of market depth to influence prices.
Between December 2011 and January 2014, the defendants allegedly placed and then quickly cancelled these deceptive orders on at least 51 trading days. This allowed them to buy or sell contracts at more favorable prices than they would have otherwise been able to achieve, the CFTC claims. The agency’s investigation, empowered by the Dodd-Frank Act, focused on proving the intent behind the order placements and cancellations.
As part of the settlement, Oystacher and 3Red will jointly pay a $2.5 million civil monetary penalty. Furthermore, an independent monitor will oversee their futures trading for three years to ensure compliance with regulations. For 18 months, they are also required to implement specific compliance tools for all U.S. exchange trading. The order permanently prohibits Oystacher and 3Red from engaging in spoofing or any other manipulative practices in futures markets.
“This Order sends a strong message to the financial markets that the CFTC will aggressively investigate, prosecute, and penalize spoofing and manipulative conduct, whenever they occur,” stated Aitan Goelman, the CFTC’s Director of Enforcement. The case highlights the agency’s ongoing efforts to maintain market integrity and deter fraudulent trading activities.
Source: CFTC.gov
Related Federal Cases
- Alan Ceccarelli, Wire Fraud and Identity Theft, NY 2016 · New York
- Sean Okrzesik, SSI Identity Theft, NY 2024 · Illinois
- Yerfri Castillo, ID Theft Tax Scam, NY, 2023 · Illinois
- Letitia James Demands ICE Identity Disclosure, New York, 2023 · New Mexico
- Omar Fandino, Access Device Theft, GA 2016 · New York
