‘Spoofing’ Conviction Upheld

Implications for private fund managers and algorithmic traders

BRIAN T. DALY, GARY STEIN, PETER H. WHITE, JACOB PREISEROWICZ, JEFFREY F. ROBERTSON and BAYARD P. BROWN, SCHULTE ROTH & ZABEL

On August 7, the U.S. Court of Appeals for the Seventh Circuit unanimously upheld the first-ever criminal conviction under the anti-spoofing provision of the Commodity Exchange Act.1 In doing so, the court rejected arguments by the defendant, high-frequency commodities trader Michael Coscia, that the anti-spoofing provision is unconstitutionally vague and that the evidence was insufficient to support his conviction. As the first appellate court to address these...

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