- JP Morgan Traders Accused of Manipulating Price of Gold, Silver for a DECADE, as DoJ Tries to Look Tough on Wall Street
Precious metals traders at JP Morgan made millions through fraudulent trades, operating a sprawling criminal conspiracy to manipulate prices, according to the US Justice Department, which appears to be signaling a crackdown.
Current and former JP Morgan precious metals traders Gregg Smith, Michael Nowak, and Christopher Jordan engaged in “a massive, multiyear scheme to manipulate the market for precious metals futures contracts and defraud market participants,” Assistant Attorney General Brian Benczkowski said in a Justice Department statement released on Monday. The DOJ claimed the bankers made millions of dollars by defrauding other market participants, including some of their own clients, in thousands of illegal trade sequences.
The trio allegedly engaged in “spoofing” on a massive scale – placing trades that they intended to cancel before execution in order to manipulate the price of gold, silver, and other precious metals – dating back over 10 years, openly discussing their illegal behavior in chat logs obtained by the prosecution and included in the indictment. They are charged with bank, wire, and commodities fraud, price manipulation and spoofing, and “conspiracy to conduct the affairs of an enterprise involved in interstate or foreign commerce through a pattern of racketeering activity” – a charge usually reserved for members of an organized crime ring.