Arab Press

بالشعب و للشعب
Monday, Apr 06, 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
Iranian Drone Strike on US Embassy in Saudi Arabia Reportedly Targeted Intelligence Facility
Saudi Deputy Foreign Minister Meets French Embassy Official to Strengthen Bilateral Engagement
Saudi Arabia Calls on United States to Seize Strategic Opportunity to Reshape Middle East
Dating Apps Surge in Saudi Arabia as Social Norms Rapidly Evolve Among Youth
Saudi Arabia Detains Over Fourteen Thousand Illegal Residents in Week-Long Enforcement Drive
Saudi Foreign Minister Engages in Diplomatic Talks with Pakistan, Kuwait and Latvia on Regional Developments
Saudi Arabia Intercepts Cruise Missile as Regional Tensions Intensify
Saudi Stock Market Edges Higher as Tadawul Index Records Modest Gain
Underlying Rivalry Between Saudi Arabia and UAE Persists Despite Temporary Calm
Saudi Arabia’s Non-Oil Sector Contracts in March as Regional Tensions Weigh on Business Activity
Saudi Arabia Unveils Ambition to Establish Prestigious Global Prize Rivaling the Nobel
Saudi Crown Prince to Engage Wall Street in Push for Investment and Economic Expansion
Iran Accuses Saudi Arabia and UAE After Downing of Chinese-Made Drone
Saudi Arabia Condemns Attack on Hospital in Sudan, Calls for Protection of Civilians
Coordinated Drone Strike Targets CIA Facility Within US Embassy in Saudi Arabia
Italy’s Meloni Prioritises Energy Security and Strait of Hormuz Stability During Gulf Tour
Uncertainty Emerges Over Timeline and Direction of Saudi Arabia’s Ambitious Ski Resort Project
UAE and Saudi Arabia Escalate Strategy with Drone Operations Targeting Iran
Trump Delivers Characteristic Remarks on Saudi Crown Prince Amid Intensifying Iran Conflict
Drone Strike on US Embassy in Riyadh Caused Greater Damage Than First Reported
Saudi Arabia Introduces Flexible Solutions for Expired Visas Amid Regional Disruptions
Saudi Arabia’s Online Car Market Accelerates with AI Pricing and Fully Digital Buying Experience
Saudi Arabia Reassesses Defence Strategy as Iranian Drone Threat Drives Shift in Military Partnerships
Drone Strikes Target Saudi Arabia, Kuwait and Bahrain as Regional Conflict Intensifies
Japan and Saudi Arabia Align Efforts to Ease Rising Tensions with Iran
Saudi Crown Prince and Italy’s Meloni Strengthen Strategic Ties in High-Level Talks
SpaceX Explores Potential Five Billion Dollar Investment from Saudi Sovereign Wealth Fund Ahead of IPO
Saudi Arabia Lifts Key Import Barriers to Expand Access for U.S. Beef Exports
Saudi Arabia Enforces Strict Travel Penalties for Visits to Restricted Countries
Italy’s Meloni Embarks on Strategic Gulf Tour to Address Energy Security and Regional Stability
Saudi Film Festival Rescheduled to Summer as Regional Tensions Continue
Saudi Arabia Reports Forty Two Point Six Billion Dollars in Foreign Tourist Spending in 2025
Saudi Crown Prince and Russian President Hold Strategic Call on Escalating Regional Crisis
Saudi Arabia Advances Rail Network as Strategic Alternative to Strait of Hormuz Shipping Route
Ruanyun Edai Launches Saudi Arabia Hub With Forecast of Ten Percent Revenue Growth
Greek Defence Minister Visits Troops in Saudi Arabia Following Successful Missile Interception
Saudi Arabia Expands Global Strategy With Focus on African Critical Minerals
SpaceX Explores Potential Five Billion Dollar Investment From Saudi Fund Ahead of Possible IPO
US Central Command Dismisses Iranian Claim of Mass Casualties Among American Personnel in Saudi Arabia
Co-Diagnostics to Establish Molecular Diagnostics Facility in Saudi Arabia Through Joint Venture
Trump Engages Saudi Crown Prince in Talks on Potential Iran Ceasefire
Saudi Arabia’s Sadara Suspends Operations as Supply Chain Disruptions Intensify
Saudi Arabia Accelerates Energy Shift by Trading Oil Revenues for Battery Investments
Saudi Arabia Introduces Flexible Options for Expired Visas Amid Regional Disruptions
Online Narratives Surge as Iran–US Tensions Spill Into Digital Arena Following Trump Remarks
Saudi Arabia Urges Trump to Seize Strategic Moment as UAE Weighs Ground Deployment
Saudi Arabia Redirects Nearly One Million Barrels of Oil Daily Away from Strait of Hormuz
Saudi Arabia Carries Out Execution of Businessman Linked to 2011 Qatif Unrest
Ukraine–Saudi Defense Pact Signals Rising Demand for Battlefield Expertise
Saudi Arabia Balances Diplomacy and Defense Preparedness Amid Iran Conflict
×