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Two Indian Americans charged for commodities markets deceptive trade practices

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Jitesh Thakkar of Illinois and New Yorker Krishna Mohan charged along with six others.

Two Indian Americans have been charged with several federal crimes for allegedly engaging with deceptive trade practices on commodities markets in the United States.

Jitesh Thakkar, 41, of Naperville, Illinois, and Krishna Mohan, 33, of New York, has been charged by the Department of Justice on Monday along with six others.

Thakkar has been charged in a criminal complaint with conspiracy and spoofing offenses alleging that he developed a software program that was used by his co-conspirator to engage in spoofing through the placement of thousands of orders on the CME.

Thakkar was the founder and principal of Edge Financial Technologies Inc. (“Edge”), an information technology consulting firm located in Chicago, Illinois.

Mohan has been charged in a criminal complaint filed in the Southern District of Texas with commodities fraud and spoofing offenses when he was employed as a programmer and trader at a proprietary trading firm in Chicago, Illinois. According to the complaint, data analysis identified that Mohan engaged in a pattern of spoofing over a thousand times in a two-month period.

Spoofing is a way of manipulating the market with the use of technology. The Criminal Division Fraud Section’s Securities and Financial Fraud Unit, the U.S. Attorney’s Office for the District of Connecticut, in conjunction with special agents from FBI Offices in New York, Chicago, Connecticut, and Houston participated in the enforcement along with other agencies.

The charges “aggressively target, among other things, the practice of spoofing, which was allegedly employed in various forms by these defendants and/or their co-conspirators to manipulate the market for futures contracts traded on the Chicago Mercantile Exchange (CME), the Chicago Board of Trade (CBOT), and the Commodity Exchange Inc. (COMEX),” said the Department in a statement.

They manipulated the market by allegedly placing thousands of orders they didn’t intend to execute. They executed genuine orders to make a profit from the price fluctuations created by their spoof orders.

“As alleged, the defendants in these cases engaged in sophisticated schemes or trading practices aimed at defrauding individuals and entities trading on U.S. futures exchanges,” said Acting Assistant Attorney General Cronan.

“Conduct like this poses significant risk of eroding confidence in U.S. markets and creates an uneven playing field for legitimate traders and investors,” he added. The Department and our law enforcement partners will use all of the tools at our disposal, including cutting-edge data analysis, to detect these types of schemes and to bring those who engage in them to justice. Protecting the integrity of our markets remains a significant priority in our fight against economic crime.”

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