On Wednesday it was announced that the CFTC has agreed with the Bank of Nova Scotia that they pay $127.4 million to settle allegations of market manipulation in precious metals futures on the COMEX exchange. The order can be found here. This article on the Bloomberg web site also covers the story.

The order states that 4 traders carried out spoofing “on thousands of occasions”. It also refers to a previous sanction for these activities in 2018, and states that some of the representations made then were false. It states that “false statements and omissions resulted in part from BNS’s incomplete and inconsistent record-keeping”.

In addition, the order reveals that the compliance function failed to detect the activity, and that the function’s response to enquiries from FCMs, that the trading was legitimate, was in fact erroneous. All of these issues have led to such a large settlement.

In another story found here on the Wall Street Journal web site, it has been revealed that in an ongoing case against traders from the Bank of America for market manipulation, the Department of Justice is alleged to have tried to discourage the Bank from running their own analysis on trading data to determine whether an abuse had occurred.