CFTC Charges Two Individuals and Their Companies with Wash Trading

The CFTC announced it filed a civil enforcement action in a Chicago federal court against two individuals and their two corporations for engaging in fictitious single stock futures transactions in OneChicago LLC and trading non-competitively.

The CFTC Complaint alleges that over seven consecutive trading days in 2014, the defendants and their companies, Tech Power, Inc. and MetroWest Law Corporation, engaged in 624 round-turn trades between an account carried in the name of MetroWest, and an account carried in the name of Tech Power involving 1,248 perfectly matched pre-arranged, non-competitive transactions in single stock futures contracts listed on OneChicago.

According to the CFTC, by structuring the transactions in this way, the defendants were able to ensure that MetroWest would trade with Tech Power, and that Tech Power would always profit from the transactions. In its continuing litigation, the CFTC is seeking disgorgement of ill-gotten gains, civil monetary penalties, trading and registration bans, and permanent injunctions against further violations.

See: CFTC Complaint; CFTC Order; CFTC Press Release.