In CFTC Action, Court Orders Precious Metals Trader to Pay Penalty and Imposes Trading Ban for Spoofing and Deceptive or Manipulative Scheme

Washington, DC — The Commodity Futures Trading Commission (CFTC) announced today that Judge Vanessa Bryant of the U.S. District Court for the District of Connecticut issued a Final Judgment and Consent Order on February 5, 2019, against Andre Flotron, a former precious metals trader for UBS AG, 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.

James McDonald, CFTC Director of Enforcement commented: 

“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.  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 (see CFTC Complaint and Press Release 7685-18), 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 (spoof orders).  The Order 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.

This case was brought in connection with the CFTC Division of Enforcement’s Spoofing Task Force, and the staff members responsible are Alben Weinstein, David Oakland, Sam Wasserman, Patryk J. Chudy, Lenel Hickson, Jr., and Manal M. Sultan.