Indian-Origin Trader Arrested In UK Over 2010 'Flash Crash'


NEW YORK: An Indian-origin futures trader has been arrested in the UK and faces extradition to the U.S. for his alleged role in the May 2010 "flash crash" which wiped billions of dollars off the value of U.S. shares in minutes.

Navinder Singh Sarao, 37, was arrested by British authorities yesterday at the request of the U.S. Department of Justice and the U.S. is requesting his extradition.

Sarao was charged in a federal criminal complaint in the Northern District of Illinois in February 2015.

The complaint charges him with one count of wire fraud, 10 counts of commodities fraud and commodities manipulation and one count of "spoofing", a practice of bidding or offering with the intent to cancel the bid or offer before execution.

The US Commodity Futures Trading Commission also announced the unsealing of a parallel civil enforcement action against Sarao and his firm Nav Sarao Futures Limited.

The CFTC complaint charges him with unlawfully manipulating, attempting to manipulate, and spoofing with regard to the E-mini S&P 500 near month futures contract.

The E-mini S&P 500 is a stock market index futures contract based on the Standard & Poor's 500 Index and is one of the most popular and liquid equity index futures contracts in the world. The contract is traded only at the Chicago Mercantile Exchange.

According to allegations in the criminal complaint, Sarao allegedly used an automated trading program to manipulate the market for E-Mini S&P 500 futures contracts on the CME.
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Source: PTI