TWO Indian Americans who were commodities traders of a New York, New York-based financial services firm have pleaded guilty for their participation in a $60 million commodities fraud and spoofing conspiracy that was perpetrated through the U.S. commodities markets, according to the U.S. Attorney’s Office of Southern District of Texas (SDTX).
One of the traders also pleaded guilty for his participation in a second commodities fraud and spoofing conspiracy at another financial services firm based in Chicago, Illinois.
U.S. Attorney Ryan K. Patrick, Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Special Agent in Charge Jeffrey S. Sallet of the FBI’s Chicago Field Office made the announcement.
Krishna Mohan, 33, of New York, pleaded guilty on Tuesday to one count of conspiracy to engage in wire fraud, commodities fraud and spoofing. Sentencing is scheduled for February 28, 2019, before U.S. District Judge Gray H. Miller of the SDTX.
Kamaldeep Gandhi, 36, of Chicago, pleaded guilty on November 2 to two counts of conspiracy to engage in wire fraud, commodities fraud and spoofing. Sentencing is scheduled for February 22, 2019, before U.S. District Judge Ewing Werlein Jr. of the SDTX.
As part of their pleas, Gandhi and Mohan admitted that from March 2012 to March 2014, they conspired with Yuchun “Bruce” Mao and others at the first firm (Trading Firm A) to mislead the markets for E-Mini S&P 500 and E‑Mini NASDAQ 100 futures contracts traded on the Chicago Mercantile Exchange (CME) and E-Mini Dow futures contracts traded on the Chicago Board of Trade (CBOT).
Gandhi and Mohan further admitted they and their co-conspirators placed thousands of orders that they did not intend to execute, or “spoof orders,” in order to obtain executions of other orders, or “primary orders,” at better prices, quantities and/or times than otherwise possible to the benefit of the co-conspirators and Trading Firm A. Gandhi and Mohan further admitted the United States has calculated that the scheme resulted in market losses of more than $60 million.
Also, as part of Gandhi’s plea, he further admitted that from May 2014 through October 2014, while employed at the second firm (Trading Firm B), he conspired with others to mislead the markets for E‑Mini S&P 500 futures contracts traded on the CME by agreeing to place, and himself placing, hundreds of spoof orders for E-Mini S&P 500 futures contracts in order to create the false and misleading appearance of increased supply or demand. Gandhi further admitted the United States has calculated that the scheme resulted in market losses of more than $1.3 million.
The FBI’s Chicago Field Office is conducting the investigation.
Individuals who believe that they may be a victim in these cases should visit the Fraud Section’s Victim Witness website for more information.