There has been more activity this week on the anti abuse side of things, following Monday’s post here on recent fines.
Ofgem, the National Regulatory Authority for the GB energy market, is to be given more powers by the UK government to enforce REMIT in terms of access to documents and the power to take them off site. This article on the Reuters web site explains the development further.
The three banks reported earlier this week to be facing sanctions in the US for spoofing, have now been settled . Deutsche bank are to pay $30m, UBS $15m, and HSBC $1.6m. These are all outlined in this CFTC press release, which also announces personal fines. CFTC Director of Enforcement James McDonald, has made this statement about the issue. This article by Matt Levine on Bloomberg asks whether spoofing’s “time is done”.
The CME has fined a trader for placing orders with no intention of execution as part of an “iceberg” strategy, as announced here. These types of fines raise many questions for traders as to what constitutes a legitimate trading strategy. It is often hard, in the absence of clear guidance to differentiate between a “market practice” and manipulation.