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This article analyzes the confusion faced by commodity futures traders in assessing whether their trading strategies constitute illegal spoofing and examines whether the CFTC and Seventh Circuit have provided sufficient guidance on the distinction between spoofing and legitimate trading activity.
In 2010, Congress expressly criminalized a type of trading activity on the commodity futures exchanges referred to as “spoofing.” This new anti-spoofing statute greatly increased a prosecutor’s power to crack down on traders who place and cancel orders at extremely high speeds through the use of powerful computer programs, supposedly in order to manipulate commodity futures prices and harm innocent investors. However, following the government’s first criminal conviction for spoofing in United States v. Coscia, questions remain about what makes a commodity futures trader’s conduct illegal instead of a legitimate trading strategy. Nonetheless, the Department of Justice (DOJ) and Commodity Futures Trading Commission (CFTC) recently have brought a substantial number of new cases against traders for violations of the anti-spoofing statute.
By Carolyn H. Kendall and Yune D. Emeritz
It is axiomatic that companies cannot do wrong without the actions of individuals. However, the trend over the past few decades, with a few exceptions, has been that individuals generally were not prosecuted for their roles in corporate wrongdoing that harmed the public welfare. However, there appears to be a recent escalation in prosecutions of corporate executives.
By Marjorie Peerce and Mark S. Kokanovich
Imagine you are in-house counsel, working on a transactional document, when you receive a breathless call from a manager at one of your warehouses that a search warrant is being executed on the premises. What do you do?
By David S. Krakoff, Bradley A. Marcus and Nadav Ariel
For companies suspected of wrongdoing, cooperating with DOJ investigations and self-disclosing their misconduct often appears to be their only option to avoid prosecution and reduce large financial penalties. But, these benefits often come at a price, especially to company employees who are caught in the middle.
By Joseph F. Savage, Jr. and Marielle Sanchez
Elections have consequences, and the election of President Trump has resulted in a significant shift in law enforcement priorities. Corporate enforcement activity is at lows not seen in decades, despite an overall increase in federal criminal cases. This is a product of a change in priorities, both in terms of types of offenses and types of offender. So, for the time being, there will be almost unprecedented opportunity to achieve favorable resolutions for corporate clients.