A high-frequency trader was indicted for 'spoofing' - placing and immediate canceling orders as a way to manipulate commodities markets - in what the U.S. Justice Department says is the first criminal case of its kind.
Bloomberg News reports that Michael Coscia, 52, of Rumson, New Jersey, the principal of Panther Energy Trading LLC, was indicted by a federal grand jury in Chicago and charged with six counts of commodities fraud and six of spoofing. He’s accused of illegally reaping almost $1.6 million as a result of orders placed through CME Group Inc. and European futures markets in 2011.
Coscia last year settled civil claims by the U.S Commodity Futures Trading Commission by paying a $2.8 million fine and consenting to a one-year trading ban.
The anti-spoofing statute is part of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act. Some trading firms have found the definition too vague and pressed CME to be more specific, two people familiar with the matter said last month.
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