The traders worked for UBS Group AG and Deutsche Bank AG, among other firms. Also facing federal charges is Andre Flotron, 53, a Swiss national now living in Wayne, N.J. and a former commodities trader at the Stamford office of UBS.
WASHINGTON-Federal prosecutors on Monday charged eight traders with deceptive trading practices in the futures markets, with all but one person charged with illegal spoofing.
A rare charge: Only three people had previously ever been charged with spoofing. The CFTC said in accepting HSBC's settlement, it "recognizes the bank's cooperation during the Division of Enforcement's investigation of this matter".
In spoofing traders place buy and sell orders with the intention of cancelling them before completing the transactions. That creates the illusion of demand, inflating prices to benefit the trader's market positions.
All three banks received reduced penalties for providing assistance in the investigation.
Rob Sherman, a spokesman for HSBC, said the bank was "pleased to have resolved this issue". They are located around the world in countries such as the US, Switzerland, UK, Australia and the United Arab Emirates.
James McDonald, director of enforcement at the CFTC, which regulates derivatives markets, said electronic and algorhythmic trading had created opportunities both for legitimate trading, which CFTC supported, and for fraud.
"These cases should send a strong signal that we at the CFTC are committed to identifying individuals responsible for unlawful activity and holding them accountable".
Jitesh Thakkar of IL has been charged with developing a software program used by his co-conspirator to engage in spoofing, the Justice Department said.
Vorley, Chanu, Zhao and Mohan could not be reached for comment, while Bases, Pacilio and Thakkar did not immediately respond to a request for comment.
Mr. Flotron's lawyer, Marc Mukasey, said the new case "is an especially enormous waste of taxpayers' money because the CFTC knows darn well that there is a pending criminal matter, that Mr. Flotron has always been retired from the business, and that he lives in Switzerland. We will take the cases to trial and he will be exonerated", Flotron's legal counsel said in a statement. Visit MarketWatch.com for more information on this news.