Former UBS precious metals trader Andre Flotron was acquitted on Wednesday of market manipulation, a development that could spell trouble for similar cases against other Wall Street traders.
Authorities arrested Flotron late last year on charges he engaged in a Wall Street practice called "spoofing," which involves placing and then immediately aborting trades to move prices.
The acquittal follows January's $46.6 million settlement with UBS, Deutsche Bank and HSBC over allegations traders at the banks worked to manipulate futures markets in precious metals between 2008 and early 2014.
Before this case, only three other people had ever been charged with "spoofing," according to the Justice Department, a practice banned under the 2010 Dodd-Frank Wall Street reform legislation.
Federal prosecutors in January unveiled charges against Flotron, a Swiss national, along with six other traders and a technology consultant allegedly involved in the manipulation. They were based in New York, Switzerland, Britain, Australia and the United Arab Emirates.
Prosecutors said the conduct was a systemic threat to markets, creating the risk of "eroding confidence" and putting honest players at a disadvantage.
Government witnesses included Flotron's former trainee, Mike Chan, who reportedly testified that he had learned to spoof at Flotron's side.
But a federal jury in New Haven, Connecticut deliberated only a short time before unanimously acquitting Flotron. He still faces a civil action by the Commodity Futures Trading Commission, which regulates futures markets.
David Liew, a former Deutsche Bank trader, pleaded guilty in June and has since cooperated with investigators.
© 2018 AFP