CFTC Charges Trader with Defrauding a Large FCM (with Lofchie Comment)

The CFTC filed an enforcement action charging a trader with defrauding a large FCM (his employer) by intentionally concealing from the FCM the true size, risk, and potential profits and losses associated with the SP 500 e-mini futures contracts position in an account controlled by the trader. As a result of the trader's concealment, the complaint charges that the firm lost almost $120 million.

Lofchie Comment: Firms being brought down by rogue traders is a recurrent drama. I would guess that there are more episodes of this than there are of failures through algos gone bad.

Click hereto view complaint in full (links externally to CFTC website).