JPMorgan To Pay $920M For Manipulating Bond, Metals Markets

In the case of the U.S. Treasury market, the Securities and Exchange Commission said JPMorgan traders submitted both trades they intended to act upon as well as spoof trades. The goal was to use the spoof to nudge the market in a certain direction, and then activate the intended trade to profit from the move.

J.P. Morgan Securities undermined the integrity of our markets with this scheme, said Stephanie Avakian, director of the SECs Division of Enforcement, in a prepared statement. Their manipulative trading of Treasury cash securities created a false appearance of activity in the market and induced other market participants to trade at more favorable prices than J.P. Morgan Securities would have otherwise been able to obtain.

JPMorgan agreed to settle with U.S. authorities, and will enter into whats known as a deferred prosecution agreement for three years. It will also pay fines and penalties to the SEC as well as the Commodities Futures Trading Commission.

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