'Flash crash' trader told he poses a 'clear flight risk'

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Navinder Singh Sarao, who stands accused of contributing to the 2010 "flash crash," failed to get his bail conditions reduced.

The high-frequency futures trader who stands accused of contributing to the stock market "flash crash" in May 2010 failed to get his bail conditions reduced Wednesday, and remains in custody.

Navinder Singh Sarao, from west London, was told by the judge at London's High Court that he posed a "clear flight risk."

Sarao has been charged by the U.S. Justice Department. He stands accused of wire fraud, commodities fraud and manipulation, and one count of "spoofing"-when a trader places a bid or offer with the intent of cancelling it before execution.

At an initial hearing in London on April 22, Sarao said he planned to fight extradition to the U.S. and was granted conditional bail by Westminster Magistrates' Court, which was set at £5 million ($7.5 million).

He failed to raise the cash needed for bail, however, because U.S. authorities had frozen his assets, his lawyer argued.

Two requests to lower the bail surety have been rejected - the first on May 6 and the second on Wednesday.

In a courtroom outburst on May 6, Sarao reacted angrily to the decision and has now been behind bars for nearly four weeks.

"I've not done anything wrong apart from being good at my job. How is this allowed to go on, man?," he said, according to Reuters.

A full hearing will take place in September, and will determine whether Sarao will be handed over to U.S. authorities to stand trial to America.

The U.S. Department of Justice alleges that Sarao "used an automated trading program to manipulate the market for E-Mini S&P 500 futures contracts (E-Minis) on the Chicago Mercantile Exchange (CME)."

Sarao's alleged manipulation of those futures tied to the Standard & Poor's 500 Index "earned him significant profits and contributed to a major drop in the U.S. stock market on May 6, 2010, that came to be known as the 'Flash Crash'," the Justice Department said in a release in April.

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