Read the links I have provided above. While I agree that electronic trading has radically altered the structure of the markets, your narrative about enforcement doesn't exactly hold water.
okay i did and i'm still not convinced. where does it say that geneva and citi will be permanently banned if they engage in it again? the most i could find was that the specific traders within Citi who engaged in spoofing were banned for a mere 6 months. many of your examples were just fines, which is exactly my point. in this day and age, any spoofing algorithm that's created by some low-level chinese or indian-american quant has to get the greenlight by someone at the top. but criminal charges are never leveled at the people at the top who authorized it. if criminal charges are leveled, at all, it's always at the disposable small-fry while the firm as an entity can just shrug off the petty fines and continue engaging in such practices. don't believe me? you used Citigroup as an example. Citigroup literally got caught spoofing in the japanese futures markets again last month. guess how much they were fined? $1.2 million. yup, that's right, $1.2 million. https://www.thetradenews.com/citi-accused-spoofing-japanese-regulator-pursues-1-2-million-fine/ while some small-fry spoofers are actually serving time in federal "pound-me-in-the-ass" prison. absolutely insane imo.
This is exactly the part that bone doesn't see. He equates a huge corporation paying a fine (ie. cost of doing business), with an individual trader going to jail for decades. I will say this at least tough. From what I've read (if my memory serves me well), Nav had multiple warnings. He was just too cocky for his own good. He could have walked away after the several warnings but ignored them.
April 29, 2019 Keeping an Eye on the Open: New Guidance from the CME Group Activities that occur immediately before and during the market open have garnered an increasing amount of surveillance interest in the past several years. CME Group’s recent updated guidance – which is an indication of how important the opening period and Indicative Opening Prices (IOPs) are to futures markets – is a helpful guide to understanding the ins-and-outs of surveilling the market and the compliance issues that either are best observed or avoided. The definitions that govern disruptive trading practices are constantly evolving and one area that has garnered an increasing amount of surveillance interest in the past several years concerns activities that occur immediately before and during the market open. As an example of this focus, the CME Group has issued a new Market Regulation Advisory Notice (MRAN) that deals specifically with this period of time in the trading day. While this MRAN is primarily a clarification and consolidation of previously issued guidance, its publication is an indication of how important the opening period and Indicative Opening Prices (IOPs) are to futures markets. The contents of this new IOP MRAN are a helpful guide to understanding the ins-and-outs of surveilling the market and the compliance issues that either are best observed or avoided. Two Rules to Follow Rules and guidance around activities in the pre-opening period are a subset of CME Group Rules 575 and 534 that govern disruptive trading practices and wash trading, respectively. Rule 575 relates to disruptive activities such as spoofing, layering or quote stuffing. The rule states that: “All orders must be entered for the purpose of executing bona fide transactions. Additionally, all non-actionable messages must be entered in good faith for legitimate purposes.” The rule goes on to list specific guidelines that govern quoting with an intent to cancel, attempting to mislead market participants, entering orders in an attempt to adversely affect the functioning of the exchange, or otherwise disrupt the markets. Rule 534 states that: “No person shall place or accept buy and sell orders in the same product and expiration month…where the person knows or reasonably should know that the purpose of the orders is to avoid taking a bona fide market position exposed to market risk (transactions commonly known or referred to as wash sales)” Wash trades are typically executed between accounts that share common beneficial ownership. Examples of disruptive behavior In addition to providing details on specific questions relating to the use of specific order types, guidance regarding automated trading systems, and testing during the opening period (hint: don’t do it!), the CME gives several examples of activities that are prohibited during the pre-open period. Prohibited activities include, but are not limited to: Scanning the book for hidden orders such as stops or icebergs, Testing market depth by entering orders until the IOP changes, Entering an order after the lockdown period (the time just prior to the opening when orders may no longer be canceled) so as to create a washed trade, and Manipulating the level of the IOP by entering large quantity orders at the beginning of the pre-open period, thereby attracting – and deceiving – other market participants. The examples listed are not meant to be exhaustive but, instead, detail some of the most common behaviors that the CME is paying attention to. Lessons to live by The rules that govern the pre-open and even the examples cited by the CME are generally not new and could, in most cases, be applied to other exchanges and include other parts of the trading day, especially the close. However, the fact that the exchange found it necessary to consolidate guidance regarding the opening period in a new MRAN highlights both the importance of the opening period for markets and the ways in which market surveillance is evolving and growing. Prohibited activities such as spoofing, layering, quote stuffing, or wash trades continue to be in the regulatory crosshairs. Both compliance and market participants will do well to have a robust surveillance program covering their and their customer’s market activities to ensure that they stay on the straight and narrow. It’s 100% certain that the CME, other exchanges and the myriad regulators will only increase their diligence going forward. The full text of Rules 575 and 534 are available online in the CME Rulebook: https://www.cmegroup.com/content/dam/cmegroup/rulebook/CME/I/5/5.pdf This article originally was published on the Eventus Systems Blog. TabbFORUM is an open community that provides a platform for capital markets professionals to share their ideas and thought leadership with their peers. The views and opinions expressed are solely those of the author(s). They do not necessarily reflect the opinions of TABB Group, its analysts, TabbFORUM and its editors, or their employees, affiliates and partners.
The case is still ongoing but it was suggested that he faced a maximum of 30 years in prison. He's now implementing others that had helped him in hopes of getting a lower sentence when the sentencing phase begins. In contrast, the article in the Chicago Sun-Times states he refused to implement others. April 23, 2019 @ https://chicago.suntimes.com/news/2...o-help-feds-bring-conviction-in-spoofing-case The details about his layering and spoofing in the E-mini futures is interesting and he did this through accounts with MF Global, Knight Futures, Marex and R.J. O'Brien. http://www.marketswiki.com/wiki/Navinder_Sarao In Chicago, never rat out your friends that were involved even though this guy is from London (U.K.) I can see a movie coming in the future about the "Flash Trader" about this situation especially if the FED fails to get any convictions. Its an amazing story because he would lose most of that 50 million dollars he made...lose most in investments soon afterwards. https://www.bloomberg.com/news/feat...sh-crash-trader-s-50-million-fortune-vanished wrbtrader
Washing dirty money...that's really what he tried to do. He took that money of 50 million he got from his illegal layering & spoofing the markets and try to then wash it clean in legal investments... Something commonly done by mobsters and the cartel. wrbtrader