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Washington — 3 yuan A JPMorgan Chase & Co. trader was acquitted of racketeering and conspiracy charges in a landmark futures manipulation trial on Wednesday, but the two were found guilty of other charges, including fraud. said a Justice Department spokesperson.
Michael Nowak, former head of the bank's Global Precious Metals Desk, Greg Smith, a precious metals trader, and Jeffrey Ruffo, a sales rep, have announced the authorities' most aggressive campaign to date targeting manipulative futures trading. He had been indicted by the Department of Justice on racketeering and conspiracy charges in a series of incidents. A trick called spoofing.
All three of her pleas of innocence were acquitted of racketeering and conspiracy. Nowak was found guilty of 13 of his charges, including fraud, impersonation, and attempted market manipulation, while Smith found him guilty of 11. Ruffo, charged only with racketeering and conspiracy, was acquitted of both.
Spoofing is the act of placing a buy or sell order and immediately canceling it, giving the impression that supply or demand is high. Three defendants were accused of using this technique to manipulate futures of metals such as gold, silver, platinum and palladium from 2008 to 2016.
, we are collectively very disappointed with the jury's verdict and will continue to work to defend his rights in court.
Lawyers for Smith and Ruffo did not immediately provide comment.
Attorneys for Nowak and Smith argued during the trial that their orders were not fraudulent. Ruffo was not a trader and there was no evidence that he understood that others were using illegal tactics, his lawyers said in opening arguments.
Impersonation was outlawed in 2010 when Congress passed the Dodd-Frank Act after the financial crisis. Since then, prosecutors have argued that the previous cases amounted to fraud.
The Extortion Act, a federal law enacted in 1970 to combat the Mafia, is rarely used to prosecute corporate crimes. This allows prosecutors to prosecute groups of individuals, including those indirectly involved in alleged wrongdoing, for participating in a "criminal enterprise." If the defendant is found guilty, the prosecutor can ask for a harsh sentence.
"Today's ruling highlights the difficulty of proving that desk and sales traders operate a 'criminal enterprise' or 'involved in a conspiracy' to commit violations. ,” said Robert Frenchman, Partner at Mukathy Frenchman LLP. He has worked on other impersonation cases. (Reporting by Michelle Price, Editing by Rosalba O'Brien and Stephen Coates)
