Flash Crash Trader Sarao Pleads Guilty to Fraud, Spoofing
- Trader admits guilt in Chicago court after U.K. extradition
- Sarao also agrees to pay $25.7 million to settle CFTC lawsuit
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Navinder Singh Sarao, the British day trader accused of contributing to the 2010 Flash Crash, was allowed to return to his parents’ home near London’s Heathrow Airport after becoming the second person convicted of manipulating commodities markets by placing orders he never intended to fulfill.
Sarao, 37, extradited from the U.K. two days ago, pleaded guilty to spoofing and wire fraud Wednesday in Chicago federal court and agreed to forfeit $12.9 million in ill-earned gains from his trades. He was accused of making $40 million spoofing CME Group Inc.’s stock futures market over five years, including on May 6, 2010, when a trading frenzy briefly wiped almost $1 trillion from the value of American equities.