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CFTC Orders New York Firm and its Trader to Pay $585,000 for Spoofing

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The Commodity Futures Trading Commission today issued two orders filing and settling charges against Thomas Donino and his employer, FNY Partners Fund LP, for spoofing—bidding or offering with the intent to cancel the bid or offer before execution. This case was brought in connection with the Division of Enforcement’s Spoofing Task Force.

The order against Donino requires him to pay a $135,000 civil monetary penalty and suspends him for three months from trading on or subject to the rules of any CFTC-designated exchange and all other CFTC registered entities and in all commodity interests. It also orders him to cease and desist from violating the Commodity Exchange Act’s spoofing prohibition. The order against FNY Partners Fund finds the firm vicariously liable for Donino’s spoofing, which Donino engaged in while a trader for FNY Partners Fund. The order against FNY Partners Fund requires it to pay a $450,000 civil monetary penalty.

“This enforcement action demonstrates the CFTC’s enhanced abilities to detect and prosecute spoofing using data analytics,” said Division of Enforcement Director James McDonald. “The CFTC will continue to identify and investigate spoofing and hold accountable both individual traders and the firms that employ them.”

Case Background

According to the orders, between January 2013 and January 2016, Donino placed multiple orders in the Chicago Board of Trade soybean futures, Commodity Exchange (COMEX) gold futures, and New York Mercantile Exchange crude oil futures markets with the intent to cancel the orders before execution. Donino’s trading pattern involved placing a small order, typically for 10 or fewer contracts on one side of the market that he wanted to get filled (genuine order), and then placing a larger order that he intended to cancel (spoof order), typically for five times as many contracts as the genuine order. Generally, Donino quickly canceled the spoof order after placing it, and often after his genuine order was filled.

The Division of Enforcement staff members responsible for this case are Nicholas Sloey, Jeff Le Riche, Allison Sizemore, Jordon Grimm, and Neel Chopra.   

 

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Regulator Information

Abbreviation: CFTC
Jurisdiction: USA

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