A trader who operated from his parents’ home in London has pleaded guilty in the US to helping trigger a 2010 Wall Street “flash crash”.
\nNavinder Sarao, 37, pleaded guilty to fraud and illegally manipulating the market.<\/p>\n
Sarao, from Hounslow, who was shackled in the Chicago courtroom, was told he faces up to 30 years in prison after admitting the charges in a plea deal.<\/p>\n
The crash on 6 May 2010 wiped nearly $1tn off the value of US shares.<\/p>\n
Sarao traded remotely on the Chicago Mercantile Exchange – a highly computerised market – from his bedroom at his parents’ home near Heathrow Airport in London.<\/p>\n
US authorities say he manipulated the market by “spoofing”, contributing to market instability that led to a brief 1,000-point fall on the Dow Jones index in New York.<\/p>\n
Though there is no English crime of “spoofing”, in the US it is the practice of manipulating the market by placing large orders before cancelling or changing them, allowing traders to buy or sell at a profit.<\/p>\n
Despite making more than \u00a310m within five years, Sarao did not indulge in a single ostentatious luxury, a court previously heard<\/a>.<\/p>\n Sarao admitted one count of spoofing and one of wire fraud, the act of defrauding money using electronic communications.<\/p>\n He had faced 22 charges carrying sentences totalling a maximum of 380 years.<\/p>\n Sarao agreed to pay the US government $12.8m (\u00a310.3m), the amount prosecutors said he earned from his illegal trading.<\/p>\n He will be released on a $750,000 bond and will be allowed to return to the UK pending sentencing in the US, judge Virginia Kendall said.<\/p>\n Sarao’s family members offered their homes to secure his release, and the judge called them in open court to confirm they understood the terms of the agreement.<\/p>\n Last year, he was locked up for four months from April to August because he could not meet bail conditions – his assets had been frozen by the US authorities.<\/p>\n He was sent to the US to face federal charges after losing a legal challenge<\/a> last month against his extradition.<\/p>\n <\/p>\n Source: bbc.co.uk<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"