HOUSTON, TX – February 25, 2019 – Krishna Mohan has been charged with spoofing and manipulative trading practices by the Commodity Futures Trading Commission (CFTC), the agency announced today. Mohan, formerly employed by a proprietary trading firm known as “Firm A,” admitted to engaging in a scheme involving thousands of instances of spoofing – placing and then canceling orders with no intention of execution – between September 2012 and March 2014.
The CFTC order requires Mohan to cease and desist from violating the Commodity Exchange Act’s prohibitions on spoofing and manipulative schemes. He is banned from trading and participating in CFTC-regulated markets for three years. While monetary sanctions have not been finalized, the CFTC has reserved the right to assess them, contingent upon Mohan’s continued cooperation with the Division of Enforcement.
According to the CFTC, Mohan and others intentionally sent false signals to the market by placing orders they never intended to fulfill. This was done to manipulate supply and demand, tricking other participants into executing trades at desired prices. The activity occurred on the Chicago Mercantile Exchange and Chicago Board of Trade.
This administrative action follows a previous case filed by the CFTC in the U.S. District Court for the Southern District of Texas, which was dismissed without prejudice to allow for this proceeding. Separately, Mohan recently pleaded guilty to one count of conspiracy to commit wire fraud, spoofing, and commodities fraud in the same court. He is currently awaiting sentencing.
“Today’s enforcement action again demonstrates the CFTC’s continued emphasis on pursuing individuals who spoof in our markets,” said James McDonald, Director of Enforcement. “This action also reflects some of the tools we can bring to bear in rooting out misconduct in our markets.”
The CFTC acknowledged the assistance of the CME Group’s Market Regulation Department, the U.S. Department of Justice, and the Federal Bureau of Investigation in this case. The investigation was conducted by staff members of the CFTC’s Spoofing Task Force, including Rachel Hayes, Rebecca Jelinek, Allison Sizemore, Stephen Turley, Peter Riggs, Chris Reed, and Charles Marvine.
Source: CFTC.gov
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