Washington D.C. – JPMorgan Chase & Company (JPMC), along with its subsidiaries JPMorgan Chase Bank, N.A., and J.P. Morgan Securities LLC (JPMS), has been slapped with a record $920.2 million penalty by the Commodity Futures Trading Commission (CFTC) for manipulative trading practices and spoofing. The charges stem from an eight-year investigation into the firm’s activity in precious metals and U.S. Treasury futures contracts traded on major exchanges.
The CFTC order details how JPMC utilized hundreds of thousands of “spoof” orders – orders placed with the intent to cancel before execution – to mislead other market participants and artificially influence prices. This illegal conduct, spanning from at least 2008 through 2016, allegedly benefited JPMC at the expense of other traders.
The $920.2 million settlement includes $311,737,008 in restitution, $172,034,790 in disgorgement, and a $436,431,811 civil monetary penalty – the largest monetary relief ever imposed by the CFTC in a spoofing case. CFTC Chairman Heath P. Tarbert stated that “Spoofing is illegal—pure and simple,” emphasizing the agency’s commitment to market integrity.
This action is part of the CFTC’s Spoofing Task Force and is coordinated with parallel actions by the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC). The DOJ entered into a Deferred Prosecution Agreement (DPA) with JPMC, deferring criminal prosecution on wire fraud charges, while the SEC issued an order imposing disgorgement and a civil monetary penalty on JPMS. The CFTC will offset payments made to the DOJ and SEC.
The investigation has already led to charges against several JPMC traders. John Edmonds and Christian Trunz have entered into cooperation agreements with the CFTC. Civil litigation continues against Michael Nowak and Gregg Smith, accused of spoofing and attempted price manipulation. The CFTC’s findings indicate the manipulative trading was conducted across multiple desks, including those headed by senior personnel.
Source: CFTC.gov
Related Federal Cases
- Joshua Lee Hernandez, Capitol Assault, District of Columbia 2021 · Washington
- Bryan Rice, Fentanyl & Gun Crimes, District of Columbia 2024 · Washington
- D.C. Woman, Covid-19 Relief Heist, District of Columbia 2024 · Washington
- DeAngelo Wayne McNeil, Gun & Crack Cocaine, District of Columbia 2024 · Washington
- Mysire Poge, Illegal Gun Possession, District of Columbia 2024 · Washington
