Former UBS Trader Fined by US Court for Spoofing

A US District Court in Connecticut has issued a Final Judgment and Consent Order against Andre Flotron, a former precious metals trader for UBS, requiring him to pay a $100,000 civil monetary penalty for spoofing and engaging in a deceptive or manipulative scheme through his spoofing in violation of the Commodity Exchange Act (CEA) and CFTC Regulations.

The Order also imposes a one-year trading and registration ban. Flotron was one of eight traders from three institutions charged by the Commodity Futures Trading Commission (CFTC) over a spoofing scheme.

“This case reflects our continued commitment to preserving the integrity of our markets – like the precious metals markets at issue here – and to rooting out unlawful practices like spoofing,” says James McDonald, CFTC director of enforcement. “As this case shows, we will continue to work vigorously to hold individuals accountable, and not just the companies that employ them, for misconduct in our markets.”

The Order, arising from a CFTC complaint filed on January 26, 2018, finds that from at least August 2008 through at least November 2013, while employed at UBS, Flotron placed large orders in the precious metals futures markets with the intent to cancel the orders before execution. It also finds that in placing the spoof orders, Flotron intended to send market participants a signal of greater supply or demand to create the misimpression that the price would move up or down and trick market participants to transact on smaller, genuine orders that he placed on the opposite side of the market.

The Order concludes that Flotron’s conduct constituted spoofing and a deceptive or manipulative scheme in violation of the CEA and CFTC Regulations.

Colin Lambert

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