Stage Set for Second-Ever Criminal Spoofing Trial

April 04, 2018

A judge in the District of Connecticut paved the way last month for what the U.S. Department of Justice (DOJ) has described as “the second spoofing case that will go to trial in the country.” By denying the defendant’s motion to dismiss the criminal conspiracy charge against him, the court set the stage for a trial to begin on April 16. Potential U.S. Supreme Court review of the validity of the nation’s first spoofing conviction has not deterred the DOJ and Commodity Futures Trading Commission (CFTC) from launching a wave of new criminal and civil spoofing cases against numerous defendants in a self-styled “Spoofing Takedown” this January. Indeed, recent developments suggest that regulators are more willing than ever to try spoofing cases based on supposed patterns observed in market data even without contemporaneous communications that suggest an intent to engage in manipulative trading.

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