Chicago trader Igor B Oystacher and his trading company 3Red Trading are to pay USD2.5 million to settle CFTC charges over spoofing and using a “manipulative and deceptive device” while trading futures contracts on multiple exchanges.

The US District Court for the Northern District of Illinois has entered a Consent Order of Permanent Injunction against the defendants, finding that the spoofing scheme involved at least five different futures contracts on four exchanges over a period of more than two years.
 
The court’s order stems from a CFTC complaint filed on 19 October 2015 relating to E-Mini S&P 500, copper, crude oil, natural gas, and VIX futures contracts.
 
The order requires Oystacher and 3Red to pay, jointly and severally, a USD2.5 million civil monetary penalty. The order also requires that an independent monitor assess and monitor for three years all 3Red’s and Oystacher’s futures trading for the purpose of identifying any future violations of the CEA and CFTC Regulations, as charged. The order also requires Oystacher and 3Red to employ certain compliance tools with respect to all of Oystacher’s futures trading on US exchanges for a period of 18 months. The order further permanently prohibits Oystacher and 3Red from spoofing and employment of manipulative or deceptive devices while trading futures contracts, including entering bids or offers with the intent to cancel the bids or offers before execution.
 
Aitan Goelman, the CFTC’s director of enforcement, says: “This order sends a strong message to the financial markets that the CFTC will aggressively investigate, prosecute, and penalise spoofing and manipulative conduct, whenever they occur.”