A New York-based proprietary trading firm and one of its co-founders have agreed to pay more than $1 million to settle charges that they engaged in a manipulative trading strategy known as “spoofing,” the Securities and Exchange Commission announced Thursday.
Briargate Trading LLP and co-founder Eric Oscher orchestrated a scheme in which they placed sham orders, known as spoofs, to create the false appearance of interest in stocks and to manipulate their prices, the SEC complaint says.
After entering spoof orders, Oscher placed real orders for the same stocks and took advantage of the altered prices. As soon as the real orders were placed, Oscher canceled the spoof orders, the SEC says.
“Spoofing is an illegal tactic where traders place fake orders to trick others into trading at inflated or depressed prices,” says Andrew M. Calamari, regional director of the SEC’s New York office. “Today’s action shows our ongoing resolve to prevent all forms of market manipulation.”
Without admitting to or denying the findings, Oscher and Briargate agreed to pay slightly more than $1 million in disgorgement, interest and civil penalties to settle the fraud charges.