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U.S. Plans to Make Arrests, Levy Fines in Futures Spoofing Cases
U.S. authorities are planning to announce fines against three global banks and the arrests of as many as eight people over the manipulation of futures markets, according to a person familiar with the matter.
U.S. authorities are planning to announce fines against three global banks and the arrests of as many as eight people over the manipulation of futures markets, according to a person familiar with the matter.
UBS Group AG, Deutsche Bank AG and HSBC Holdings Plc will be penalized Monday by the Commodity Futures Trading Commission as the Justice Department nabs former traders and employees of proprietary trading companies for their roles in so called spoofing, said the person who asked not to be named because the matter is confidential.
The Justice Department and the CFTC will announce the arrests at a news conference in Washington, the person said. The arrests are tied to about five separate cases, the person said.
The arrests and penalties were reported earlier by Reuters.
Spokesmen for UBS, Deutsche Bank and HSBC declined to comment. A representatives for the CFTC declined to comment and a spokesman for Department of Justice didn’t immediately respond to a request for comment.
The enforcement actions extend the Justice Department’s examination of whether bank traders conspired to rig interest-rate benchmarks and manipulate currency exchanges during the past decade. The probes, which led to guilty pleas and billions of dollars in payouts by some of the world’s biggest banks, also led prosecutors to begin investigating whether metals traders placed orders without intending to execute them to try to move prices in their favor, a tactic known as spoofing.
In September, Andre Flotron, a former trader at UBS, was charged with conspiracy and fraud over his suspected role in manipulating the price of precious metals. In June, David Liew, a former Deutsche Bank trader, pleaded guilty to conspiring to manipulate futures contracts in precious metals.