Two former Deutsche Bank precious metals traders have been found guilty in a Chicago court of spoofing precious metals markets. James Vorley and Cedric Chanu were convicted of three and seven counts of wire fraud respectively, however they were cleared of conspiracy charges.
Vorley, who was based in London, and Chanu, who worked in both London and Singapore face a sentencing hearing in January 2021, US prosecutors say they are going to push for a sentence of four to five years imprisonment. They were convicted of spoofing in CME Group’s Commodity Exchange between 2008 and 2013, their conviction was sealed in some part by evidence from a former junior colleague, David Liew, who gave evidence for the Department of Justice. Liew faces his own charges over spoofing, but agreed to cooperate with prosecutors.
During the trial, the defendants argued their actions were “bluffing” rather than spoofing and were not illegal, however market observers note that “bluffing” also suggests a lack of “intention to trade” – often seen as a crucial element in deciding spoofing allegations. Both men are expected to appeal their conviction.
“Today’s jury verdict shows that those who seek to manipulate our public financial markets through fraud will be held accountable by juries and the department,” says acting assistant attorney general Brian Rabbitt of the Justice Department’s Criminal Division.