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JPMorgan Chase & Co settles class action lawsuit on ‘spoofing’

On Behalf of | Sep 27, 2021 | Business & Commercial Litigation |

Investors in Norcross may be interested to hear that investment bank JPMorgan Chase & Co. recently settled a class action lawsuit to in the amount of $15.7 million. The class action lawsuit was brought by investors who claimed JPMorgan Chase & Co manipulated U.S. Treasury futures and options following allegations of “spoofing.”

What is spoofing?

Spoofing involves the illegal trade in futures and precious metals. Traders will place an order that they have no intention of following through on with the goal of moving prices in a way that benefits them financially. The Justice Department has utilized sophisticated data analysis programs that allowed them to detect potential acts of spoofing.

The details of the settlement

JPMorgan has not admitted to any wrongdoing. The $15.7 million payout would not cover all the damages suffered by the class filing the initial claim. The settlement covers traders from April 2008 to January 2016. The settlement is awaiting approval by a federal judge.

JPMorgan has been accused of spoofing in the past

This recent settlement is not the first time JPMorgan has been accused of spoofing. In September 2020, the investment bank entered into a deferred prosecution agreement after facing allegations of spoofing in Treasuries and precious metals. The investment bank agreed to pay $920 million in damages. This amount included a criminal fine of $436 million. As part of the settlement, the investment bank also agreed to self-reporting requirements should such violations happen in the future.

Learn more about banking litigation

Investment banking litigation is complicated, and this post only scratches the surface of spoofing and other legal allegations banks may face. Investors and banks alike could benefit from having a more detailed understanding of business litigation in the event they find themselves facing such situations.