FLUSHING, NY – Pak Tong Lui, 41, of Flushing, New York, has been charged with trade manipulation and operating as an unregistered commodity trading advisor, the U.S. Commodity Futures Trading Commission (CFTC) announced on April 26, 2007.
The CFTC alleges that Lui, also known as Patrick Lui, engaged in a scheme to prearrange trades on behalf of 27 customer accounts in E-mini Russell 2000 futures contracts traded on the Chicago Mercantile Exchange’s Globex platform. The manipulative trading occurred during thinly traded overnight hours in November and December 2005.
According to the CFTC’s order, Lui traded at least fifteen customer accounts against each other. Eleven of these accounts collectively lost $55,505, while the remaining four realized approximately the same amount in profits. The agency determined these prearranged trades eliminated market risk and fair price competition, violating both the Commodity Exchange Act (CEA) and CFTC regulations.
The CFTC further found that Lui was not registered with the Commission as a commodity trading advisor, illegally allowing him to trade customer accounts.
As a result of the settlement, Lui is required to pay a $30,000 civil penalty and restitution of $55,505 to the affected customers. Additionally, he is prohibited from applying for or seeking exemption from registration with the CFTC for a period of four years.
The case was handled by CFTC staff members William Janulis, Michael Tallarico, Rosemary Hollinger, Scott Williamson, and Richard Wagner.
Source: CFTC.gov
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