WASHINGTON D.C. – Commodity trader Randy Chen and his employer, Tanius Technology, LLC, have been slapped with penalties by the Commodity Futures Trading Commission (CFTC) for engaging in a large-scale spoofing scheme. The CFTC announced the settlements today, alleging the illegal activity took place on the Chicago Mercantile Exchange (CME) between October 1, 2020, and June 30, 2021.
Chen, a California resident who worked at Tanius Technology, is accused of spoofing – placing bids or offers with the intent to cancel them before execution – across 12 different futures contracts, with a primary focus on Treasury futures. The CFTC alleges Chen engaged in this manipulative practice on over 1,000 separate occasions.
As a result of the CFTC’s investigation, Chen will pay a $150,000 civil monetary penalty and is barred from trading on any CFTC-designated exchange or registered entity for six months. He is also ordered to cease and desist from further violations of the Commodity Exchange Act’s spoofing prohibition.
Tanius Technology, a California-based proprietary trading firm, has been deemed vicariously liable for Chen’s actions. The firm will pay a significantly larger $600,000 civil monetary penalty. Gretchen Lowe, Acting Director of the CFTC’s Division of Enforcement, stated the action underscores the agency’s commitment to rooting out spoofing, which “threatens the integrity of the derivatives markets.”
The CME Group has also taken disciplinary action against both Chen and Tanius Technology, further demonstrating a coordinated effort to address market manipulation. The CFTC acknowledged and thanked the CME Group for their assistance throughout the investigation. The case was led by CFTC staff members Anthony Biagioli, Allison Sizemore, Jeff Le Riche, Christopher Reed, and Charles Marvine, with contributions from the Division of Enforcement Spoofing Task Force.
Source: CFTC.gov
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