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Day After SEC Charges HFT Trader With Spoofing, Another HFT Spoofer Sends S&P Soaring
Just yesterday, the SEC charged Canadian Aleksandr Milrud with orchestrating a lucrative market manipulation scheme that relied on "layering" (or "spoofing") in which a trader places orders solely to trick others into buying or selling at artificially inflated or depressed prices... So we found it ironic that twice today, Nanex exposed examples of the "spoofing" manipulation in crude oil futures (which soared) and S&P 500 e-mini futures (which soared)...
As The SEC statement explained...
The Securities and Exchange Commission today charged a man living in Ontario, Canada, with orchestrating a lucrative market manipulation scheme that relied on “layering” in which a trader places orders solely to trick others into buying or selling U.S. publicly traded stocks at artificially inflated or depressed prices.
In a complaint filed in federal court in Newark, N.J., the SEC alleges that since at least January 2013, Aleksandr Milrud recruited online traders chiefly based in China and Korea and shared in the profits the traders made from manipulative trading in U.S. securities markets. Milrud provided the traders with access to trading accounts and technology and instructed them on how to avoid regulatory scrutiny while engaging in layering strategies. The SEC’s complaint also alleges that to distance himself from certain transactions, Milrud wired funds to an offshore bank account and had the money delivered to him in a suitcase filled with cash.
In a parallel action, the U.S. Attorney’s Office for the District of New Jersey today announced criminal charges against Milrud.
“Layering is a deceptive practice to trick others into buying or selling a stock at artificially inflated or depressed prices,” said Daniel M. Hawke, Chief of the SEC Enforcement Division’s Market Abuse Unit. “No matter where they are located, we continue to identify and investigate those whose trading practices threaten to undermine the fair operation of the U.S. securities markets.”
According to the SEC’s complaint, Milrud inserted numerous middlemen into his scheme in an effort to evade detection. He had his traders use multiple computers, Internet protocol (IP) addresses, and user names. Traders were provided at least two accounts, one to do what Milrud called “the dirty work” of layering and one to execute what he termed “clean” trades at prices affected by the dirty work of the first account. Milrud instructed the traders to conduct layering on a wide variety of stocks while limiting the number of trades and the price changes, hoping to minimize attention to the manipulative trading.
“Milrud’s elaborate efforts to disguise this manipulative trading scheme were ultimately unsuccessful,” said Joseph G. Sansone, Co-Deputy Chief of the SEC’s Market Abuse Unit. “His scheme was uncovered and he must now face the consequences of his actions.”
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Nanex explains how it worked...
Canadian Man Charged Over High-Speed Trading Scheme - Here's how it worked: pic.twitter.com/rG1OMQAZDu
— Eric Scott Hunsader (@nanexllc) January 14, 2015
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And then just one day later - at least 2 examples of the very same "spoofing"...
In Crude futures...
And in S&P 500 e-mini futures... Spoofing S&P 500 futures higher with a $200M order.
Source: @NanexLLC
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These are your "most liquid and transparent capital markets in the world."
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he learned it from watching the queen of spoofing: yellen and the crown prince: helicopter ben
As the premier U.S. megalomaniac hag once said:
“At this point, what difference does it make?.
All this spoofer likely did was figure out a trickier way to spoof the spoofers and trigger the triggers and fluff the huffers.
The day I see them shut down these HFT fuckers and not a day earlier I will know the SEC means business. Going after small fish means shit.
They add liquidity my ass.
It will never happen though.....NEVER.
Market manipulation, imagine that....
Whack-A-Mole.
If the spoofer has the right cufflinks......
Exactly. You are true to your name sir...
What we are witnessing is the FED enforcing their dominance or HFT and market rigging, by nailing those private entities who are not complicit and in line with the Governments agenda.
BINGO !!!!
They lose this market, they lose everything.
They know that.
So they do whatever it takes, in this case ...........spoofing.
What a horror show.
Well, if it´s her, then lets dump the spoofing nomenclature and call it something more accurate: varting.
Exactly. You are true to your name sir...
What we are witnessing is the FED enforcing their dominance or HFT and market rigging, by nailing those private entities who are not complicit and in line with the Governments agenda.
ES and CL will come down again because this time it's different. Spoof me once, spoof me twice .... but the third I spoof you
wait ..you mean...NO
Relax. We have Maxine Waters on this.
If gravity was stupidity, what would Maxine Waters be?
a black hole?
First clue he wouldn't get away with it - he didn't work for Goldman or JP.
you don't spoof us, we spoof you!
free sergey. free corzine.
what's funny is how such big moves are caused by such puny phony trades. waddell & reed almost single handedly demolished the "market". what does that tell you about the alleged liquidity?
there is no market, there is only old yeller
and I will cry when old yeller dies....
i will spoof you into buying a mini tomorrow. bwa ah ah!
we spoofed some folks
“His scheme was uncovered and he must now face the consequences of his actions.”
Does this mark a sudden policy shift for the SEC?!
do you mean "dark pools" ?
CENTRAL COMMAND
Hey look, the SEC actually caught someone engaging in fraud. Oh, it's only a Canadian, pity.
don't you have to throw canadians back? isn't there a size limit or something?
They gotta offer up something
Doing gods work.
No way SEC sleuths could have figured this out. Likely ratted out by an insider. SEC needs to offer this guy a high paying career job instead of prosecuting him.
Spoofing willmost likely continue-but that is short term stuff--if you want to make money with swing trades--follow this guy-he has nailed almost every top/bottom.
http://www.sentimenttiming.com/using-time-confident-trades/
Yeah but when its a goldman/Fed manipulative rigging its ok..
Just like when central bankers tell lies.
I'm probably aging myself, but is that really Nanex or just Atari Defender screen caps?
Oh my bad - it's Parsec.
Why do I get the feeling that the SEC reads these posts and then just squelch shut their squid eyes yelling "LAAA-LAA LAAA"?
Thanks for bringing this to our attention. I was reading about Milruk yesterday and then today watched with fucking amazement how the spoofing carried on without any indictments to the big guys.
ZH is top notch and really stands out by connecting the dots
Any SEC game of hide and seek.