Washington, D.C. – Krishna Mohan has been charged by the Commodity Futures Trading Commission (CFTC) with engaging in manipulative and deceptive schemes involving thousands of acts of spoofing – bidding or offering with the intent to cancel the order before execution – in futures contracts traded on the Chicago Mercantile Exchange and Chicago Board of Trade. The charges stem from conduct while Mohan was employed at a proprietary trading firm, referred to as “Firm A” in the CFTC order.
The CFTC order requires Mohan to cease and desist from violating the Commodity Exchange Act’s prohibition on spoofing and manipulative schemes. He is banned from trading and other activities in CFTC-regulated markets for three years. Monetary sanctions have been reserved pending the completion of his cooperation agreement with the CFTC’s Division of Enforcement.
According to the CFTC, between September 2012 and March 2014, Mohan, both individually and with others at Firm A, placed thousands of orders to buy or sell futures contracts with the intent to cancel them before execution. This was done to create false signals of supply or demand, misleading other market participants.
The CFTC initially filed charges against Mohan in the U.S. District Court for the Southern District of Texas (CFTC v. Mohan, No. 18-cv-260), but that action was dismissed without prejudice to allow for this administrative proceeding.
Separately, Mohan recently pleaded guilty to one count of conspiracy to commit wire fraud, spoofing, and commodities fraud in the U.S. District Court for the Southern District of Texas. He is currently awaiting sentencing on that charge.
James McDonald, Director of Enforcement at the CFTC, emphasized the agency’s commitment to pursuing individuals who engage in spoofing. He highlighted the cooperation program as a tool for rooting out misconduct, noting that monetary sanctions may be postponed when an individual demonstrates and maintains cooperation.
The CFTC’s Enforcement Division received assistance from the Market Regulation Department of the CME Group, the U.S. Department of Justice, Fraud Section, and the Federal Bureau of Investigation. The case was handled by Rachel Hayes, Rebecca Jelinek, Allison Sizemore, Stephen Turley, Peter Riggs, Chris Reed, and Charles Marvine as part of the CFTC’s Spoofing Task Force.
Source: CFTC.gov
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