JPMorgan To Pay Record $920 Million To Resolve Investigations Into Alleged Spoofing

As reported Tuesday, JPMorgan Chase & Co. (“JPMorgan”) has “agreed to pay $920.2 million in criminal penalties, disgorgement and restitution under a three-year deferred prosecution agreement with the U.S. Department of Justice” (“DOJ”).  The DOJ alleged that JPMorgan traders “engaged in ‘unlawful trading’ in the U.S. treasury futures and precious metals futures markets over an eight-year period beginning in 2008.”  The DOJ’s press release explains, “[a]ccording to admissions and court documents,” from 2008 to 2016, traders on JPMorgan’s precious metals and U.S. Treasuries desks placed buy and sell orders for metals futures and Treasury products with the intent to cancel those orders before execution.  
 
This strategy is known as “spoofing,” and is “meant to send false price signals and move markets in favorable directions. “  The settlement is “the largest ever imposed for this type of fraudulent activity,” and resolves investigations by the DOJ, Commodity Futures Trading Commission, and the Securities and Exchange Commission.