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Gold, silver spoofing charges lead the way in record year for CFTC

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(Kitco News) - Last month JPMorgan Chase was hit with a record fine of nearly $1 billion for manipulating precious metals markets, but they are far from being a category all on their own.

This past year the precious metals market has once again seen an unprecedented focus on manipulation. Tuesday, the Commodity Futures Trading Commission (CFTC) announced that the fiscal year 2020, which ended Sept. 30, was a record year of enforcement in the agency s 45-year history.

Some of the highlights for the CFTC in this past year included 115 enforcement actions. The agency said that it has also been aggressively pursuing investigation as the nation remains firmly in the grip of the COVID-19 pandemic.

We are tough on those who break the rules, and this historic year only further underscores this point,” CFTC Chairman Heath Tarbert, said in a press release. The case statistics alone are impressive, but the fact that the enforcement program was this successful even during a pandemic is even more remarkable.

In the midst of a pandemic, when volatility in the market is high, it is even more important that our team work tirelessly to preserve market integrity and pursue those who break our rules,” added Director of Enforcement James McDonald.

JPMorgan made the top of this year s highlight reel after being fined $920 million for spoofing gold and silver markets from 2008 to 2016.

Before JPMorgan, the CFTC fined the Bank of Nova Scotia more than $127 million for spoofing and manipulating precious metals markets and providing false statements.

Outside of the precious metals market, the CFTC fined proprietary trading firm Tower Research Capital $67 million for spoofing markets and engaging in manipulative and deceptive schemes.

Meanwhile, Deutsche Bank AG, was fined $10 million for failing to meet numerous swap data reporting requirements.

An Australian-based proprietary trading firm Propex Derivatives Pty Ltd was fined $1 million for spoofing and manipulating S&P 500 future contracts.

Spoofing is an illegal high-frequency trading strategy where bids and offers are placed on an exchanged and then cancelled before they can be filled. The orders are placed with no intention of them ever being filled.

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