According to Reuters, a federal judge in Chicago said four former JPMorgan Chase & Co employees must face charges including racketeering in a case accusing them of manipulating the prices of precious metals futures.
US District Judge Edmond Chang’s ruling on Tuesday, August 17, paves the way for an October 19 trial in the case, which is the US Department of Justice’s most aggressive attempt so far to police commodities spoofing, a tactic involving placing orders to move prices and quickly cancelling them.
Prosecutors allege former global precious metals desk head Michael Nowak, traders Gregg Smith and Christopher Jordan, and salesperson Jeffrey Ruffo manipulated the prices of gold, silver, platinum, and palladium between 2008 and 2016.
Attorneys for Jordan and Nowak and a spokesperson for the DOJ declined to comment on Wednesday. Counsel for the other defendants did not immediately reply to requests for comment.
In his ruling, Chang rejected the defendants’ argument that the allegation that they engaged in a single spoofing conspiracy was not enough to support the racketeering charge.
Chang also allowed the other eleven charges to stand, including market manipulation, spoofing, conspiracy, and commodities and wire fraud. He cited other spoofing cases in which judges allowed prosecutors to pursue those charges.
The judge did, however, throw out bank fraud charges against Smith, Nowak, and Jordan, saying prosecutors had not pinpointed how or when they sought to deceive JP Morgan.
