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Abstract:Two former JPMorgan precious metals traders receive sentencing for fraud, price manipulation, and spoofing, causing millions in market losses.
The U.S. Justice Department has pronounced its judgment on two former JPMorgan traders for their involvement in illicit trading practices. The verdict stems from a series of fraudulent activities that not only misled the market but also resulted in considerable financial loss.
The traders in question are Gregg Smith, 59, of Scarsdale, New York, and Michael Nowak, 49, of Montclair, New Jersey. Smith was sentenced to two years in jail and a $50,000 fine by the Justice Department. Nowak, on the other hand, got a one-year and one-day imprisonment, as well as a $35,000 fine.
These two traders were pivotal players in a long-running market manipulation scheme, which stretched from 2008 to 2016. This deceitful operation encompassed tens of thousands of illegal trading sequences. As a result, unsuspecting market participants faced a staggering loss of over $10 million.
A significant aspect of their malpractice was “spoofing.” This tactic involves swiftly placing orders and then canceling them. The intent behind this is to artificially give the impression of a surge in demand or supply. Such misleading strategies can have detrimental effects on the market, influencing unsuspecting traders based on this faux demand or supply.
This practice of spoofing was officially deemed illegal in 2010. The decision came with the passage of the Dodd-Frank Act by the U.S. Congress in the wake of the financial crisis.
Smith and Nowak faced a plethora of counts in a previous trial. While they were convicted of fraud and other connected offenses, they were cleared of racketeering and conspiracy counts. Nowak was found guilty of more than a dozen offenses, including spoofing, fraud, and market manipulation efforts. Smith was convicted of 11 different crimes.
In light of these fraudulent activities and misconduct by its traders, JPMorgan conceded to its missteps in 2020. The financial institution agreed to a hefty settlement, shelling out more than $920 million. This move was an attempt to make amends with both the Justice Department and the Commodity Futures Trading Commission.
For those keen on staying updated with J.P. Morgan's latest activities and news, you can visit their dealer page: https://www.wikifx.com/en/dealer/8981623292.html. Additionally, for real-time news updates, consider downloading and installing the WikiFX App on your smartphone.
Disclaimer:
The views in this article only represent the author's personal views, and do not constitute investment advice on this platform. This platform does not guarantee the accuracy, completeness and timeliness of the information in the article, and will not be liable for any loss caused by the use of or reliance on the information in the article.
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