JPMorgan to pay $920.2m to settle CFTC charges for spoofing and manipulation
The manipulative and deceptive conduct and spoofing lasted at least eight years and involved hundreds of thousands of spoof orders in precious metals and U.S. Treasury futures contracts.
The United States Commodity Futures Trading Commission (CFTC) today issued an order filing and settling charges against JPMorgan Chase & Company and its subsidiaries, JPMorgan Chase Bank, N.A., and J.P. Morgan Securities LLC (collectively, JPM), for manipulative and deceptive conduct and spoofing that spanned at least eight years and involved hundreds of thousands of spoof orders in precious metals and U.S. Treasury futures contracts on the Commodity Exchange, Inc., the New York Mercantile Exchange, and the Chicago Board of Trade. This case is brought in connection with the Division of Enforcement’s Spoofing Task Force.
The order finds that JPM’s illegal trading significantly benefited JPM and harmed other market participants. JPM is required to pay a total of $920.2 million. This is the largest amount of monetary relief ever imposed by the CFTC, including the highest restitution ($311,737,008), disgorgement ($172,034,790), and civil monetary penalty ($436,431,811) amounts in any spoofing case.
In a parallel matter, the Department of Justice’s Fraud Section and the United States Attorney’s Office for the District of Connecticut today announced entry of a Deferred Prosecution Agreement (DPA) with JPMC & Co., deferring criminal prosecution of JPMC & Co. on charges of wire fraud. Under the terms of the DPA, JPMC & Co. has agreed, among other things, to pay a criminal fine, disgorgement, and restitution.
In another parallel matter, the Securities and Exchange Commission (SEC) today announced entry of an order filing and settling charges against JPMS imposing both disgorgement and a civil monetary penalty. The CFTC order will recognize and offset any restitution and disgorgement payments made to the DOJ and the SEC.