(Bloomberg) —CMEGroup Inc. said it suspended two traders for placing manipulative trades, similar to the ones that got Navinder Singh Sarao into headlines around the world last week.
Heet Khara and Nasim Salim engaged in a practice called layering, in which orders are placed with no intention of following through on them, according toCME, the owner of the futures exchange where the two gold and silver traders did business. Khara and Salim are barred from trading onCMEmarkets for 60 days.
Sarao was catapulted into the spotlight after U.S. prosecutors accused him of a five-year pattern of manipulation atCME, including layering and a related technique called spoofing. While Saraos alleged misdeeds took place as far back as 2009, Khara and Salim were cited for problematic behavior earlier this year. CMEs primary U.S. regulator, the Commodity Futures Trading Commission, last year saidCMEwas taking too long to complete investigations of improper trading.
Khara and Salim appeared to coordinate their activity,CMEsaid in statements e-mailed Thursday evening. Both repeatedly entered orders or layered multiple orders for Gold and Silver futures contracts without the intent to trade,CMEsaid. Feigning interest in completing a trade is discouraged because it can drive prices in directions they wouldnt otherwise move.
Closed Account
Salim hadnt responded to correspondence fromCME, while both had failed to cooperate with the exchange, it said. Khara and Salim couldnt immediately be contacted for comment, and calls and e-mails after hours to fourCMEspokespersons as to whether the two would challenge the ban or the investigations findings werent answered.
Kharas purportedly inappropriate trading spanned Feb. 1 to April 28, according toCME. The exchange notified his broker. Khara then closed that account and opened another elsewhere, engaging in the same improper behavior,CMEsaid. Salims alleged misdeeds took place from March 1 to April 28.
