Arab Press

بالشعب و للشعب
Tuesday, Feb 24, 2026

Ex-JPMorgan traders cleared of racketeering, found guilty of fraud

Ex-JPMorgan traders cleared of racketeering, found guilty of fraud

Case is seen as Justice Department's most aggressive to date targeting a manipulative futures trading tactic

Three former JPMorgan Chase & Co. employees were acquitted of racketeering and conspiracy charges in a landmark futures manipulation trial on Wednesday, although two were found guilty on other charges including fraud, a Department of Justice spokesperson said.

The case against the bank's former global precious metals desk head Michael Nowak, precious metals trader Gregg Smith and salesperson Jeffrey Ruffo is seen as the Justice Department's most aggressive to date targeting a manipulative futures trading tactic known as spoofing.

Nowak was convicted on 13 other charges including fraud, spoofing and attempted market manipulation, and Smith was convicted on 11 charges. Ruffo, who was only charged with racketeering and conspiracy, was acquitted of both. All three men had pleaded not guilty.

While financial reform advocates hailed the convictions as a clear signal that Wall Street executives are not above the law, attorneys said it underscored the difficulty of proving the more ambitious charges of racketeering and conspiracy.

Spoofing involves placing and then quickly canceling orders to falsely create the impression of high demand or supply. The three defendants were accused of using the tactic to manipulate futures on precious metals futures between 2008 and 2016.

"While we are gratified that the jury acquitted Mr. Nowak of racketeering and conspiracy, we are extremely disappointed by the jury's verdict on the whole, and will continue to seek to vindicate his rights in court," Nowak's attorney David Meister said.

Attorneys for Smith and Ruffo did not immediately provide comment.

Defense attorneys argued during the trial that Smith and Nowak's orders were not fraudulent. Ruffo was not a trader, and there was no evidence that he understood others were using illicit tactics, his attorney told jurors.


Their trial in Chicago began July 8 and hinged on testimony from two former JPMorgan metals traders who had pleaded guilty and cooperated with the government, as well as trading data that prosecutors said showed Smith and Nowak engaged in a repeated pattern of spoofing.

An American flag waves outside the U.S. Department of Justice Building in Washington, U.S., December 2, 2020. 


The case is part of a push by the Justice Department to crack down on spoofing and commodities market manipulation more broadly.

Spoofing was outlawed in 2010 when Congress passed the Dodd-Frank Act after the financial crisis. Since then, prosecutors have argued that earlier instances constituted fraud.

The racketeering statute, a federal law enacted in 1970 to take down the mafia, is rarely used to prosecute corporate crime. It allows prosecutors to charge a group of individuals, including those indirectly involved in alleged wrongdoing, on the basis they participated in a "criminal enterprise."

While the law also allows prosecutors to seek prison sentences of up to 20 years, Wednesday's verdict highlights that the charge can be tough to prove when it comes to competing traders on desks, said Robert Frenchman, a partner at Mukasey Frenchman LLP who was part of a trial team in 2018 that won a full acquittal for former UBS trader Andre Flotron.

Flotron had been charged with a single count of conspiracy to engage in commodities fraud.

"The reality is that traders have competing interests, run their own trading books, and often conduct themselves more like rivals than co-conspirators," Frenchman said.

Newsletter

Related Articles

Arab Press
0:00
0:00
Close
GCC Secretary-General Holds Talks with EU Ambassador in Riyadh
Gulf States’ AI Investment Drive Seen as Strategic Bet on Technology and U.S. Security Ties
African Union Commission Chair Meets Saudi Vice Foreign Minister to Deepen Strategic Cooperation
President El-Sisi Holds Strategic Talks with Saudi Crown Prince in Riyadh
Lucid Unveils Up to $12,000 Incentive for Air and Gravity Models in Saudi Arabia
Saudi Arabia Enters Global AI Partnership, Expanding Its Role in International Technology Governance
Saudi Arabia’s Landmark U.S. LNG Agreement Signals Major Strategic Shift
Saudi Arabia Accelerates Global Gaming Push with Billion-Dollar Deals and Expanded PIF Mandate
Saudi Arabia Reports $25.28 Billion Budget Deficit in Fourth Quarter of 2025
Alvarez & Marsal Tax Establishes Dedicated Pillar Two and Transfer Pricing Team in Saudi Arabia
United States Approves Over Fifteen Billion Dollars in Major Arms Sales to Israel and Saudi Arabia
Pre-Iftar Walks Gain Momentum as Ramadan Wellness Trend Spreads
Middle East Jackup Rig Fleet Contracts Further After Saudi Drilling Suspensions
Türkiye and Saudi Arabia Prepare to Sign Five Gigawatt Renewable Energy Deal at COP31
King Mohammed VI Congratulates Saudi Leadership on Founding Day, Reaffirming Strategic Ties
US Envoy Huckabee Clarifies Remarks on Israel After Expansionism Controversy
Saudi Arabia Introduces Limited Exceptions to Regional Headquarters Requirement for Foreign Firms
Saudi Arabia Joins Global Partnership on Artificial Intelligence, Elevating Its Role in Shaping AI Governance
Saudi Arabia and Arab States Mobilise Diplomatically After U.S. Envoy’s Israel Remarks
Cristiano Ronaldo Reaffirms His Commitment to Saudi Arabia Amid Transfer Speculation
Proposed US-Saudi Nuclear Deal Raises Questions Over Uranium Enrichment Provisions
Saudi Arabia Sends 81st Aid Flight to Gaza as Humanitarian Air Bridge Continues
Global Games Show Riyadh 2026 Positioned as Catalyst for Saudi Arabia’s Vision 2030
Saudi Arabia Eases Procurement Rules, Allowing Foreign Firms Greater Access to Government Contracts
Türkiye and Saudi Arabia Seal Two Billion Dollar Solar Energy Agreement
Saudi Crown Prince Reportedly Sends Letter to UAE Leader Over Yemen and Sudan Policies
Saudi Arabia Voices Concerns to UAE Over Sudan Conflict and Yemen Strategy
Saudi Arabia Joins Global Artificial Intelligence Alliance to Strengthen International Collaboration
Shura Island Positioned as Flagship of Saudi Arabia’s Ambitious Red Sea Tourism Drive
Saudi Arabia Rebukes Mike Huckabee Over Remarks in Tucker Carlson Interview
OpenAI CEO Sam Altman praises the rapid progress of Chinese tech companies.
Concerns Mount Over Potential Saudi Uranium Enrichment in Prospective US Nuclear Accord
Trump Directs Government to Release UFO and Alien Information
Trump Signs Global 10% Tariffs on Imports
Investability Emerges as the Defining Test of Saudi Arabia’s Next Market Phase
Saudi Arabia’s Packaging Market Accelerates as Sustainability and E-Commerce Drive Transformation
Saudi Arabia Unveils $32 Billion Push Into Theme Parks and Global Entertainment
Saudi Crude Exports to India Climb Sharply, Closing Gap With Russia
Saudi Arabia’s Halal Cosmetics Market Expands as Faith and Ethical Beauty Drive Growth
ImmunityBio Secures Saudi Partnerships to Launch Flagship Cancer Therapy
United Kingdom Denies U.S. Access to Military Base for Potential Iran Strike
Türkiye and Saudi Arabia Launch Expanded Renewable Energy Partnership
US Supreme Court Voids Trump’s Emergency Tariff Plan, Reshaping Trade Power and Fiscal Risk
Mongolian Mining Family’s HK$247 Million Stanley Home Purchase Highlights Resilient Luxury Market
UK Intensifies Efforts to Secure Saudi Investment in Next-Generation Fighter Jet Programme
Saudi Arabia Tops Middle East Green Building Rankings with Record Growth in 2025
Qatar and Saudi Arabia Each Commit One Billion Dollars to President Trump’s ‘Board of Peace’ Initiative
Ramadan 2026 Prayer Times Set as Fasting Begins in Saudi Arabia and Egypt Announces Dates
Saudi Arabia Launches Ramadan 2026 Hotel Campaign to Boost Religious and Leisure Tourism
Saudi Arabia Seeks Reroute of Greece-Bound Fibre-Optic Cable Through Syria Instead of Israel
×