UK Futures Trader Linked to 2010 Flash Crash, Charged Tuesday
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Amana Images / Thinkstock(NEW YORK) — A U.K. futures trader was charged on Tuesday with stock market manipulation linked to the May 6, 2010 flash crash that saw the Dow Jones Industrial Average fall 1,000 points and the market drop by nine percent in just minutes.
Navinder Singh Sarao “on numerous occasions spoofed the market,” the FBI said. He allegedly used “exceptionally large, aggressive, and persistent” tactics. By using a “layering algorithm,” Sarao made multiple large-scale sell orders that caused the market to sell off, but then cancelled all of his orders before they were ever processed.
The criminal complaint against Sarao alleges that he used automated trading programs to make and cancel the orders.
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