- A former J.P. Morgan precious metals traders pleaded guilty Tuesday to criminal charges of manipulating the precious metals markets for nine years.
- Christian Trunz, 34, of London is cooperating with an ongoing federal criminal investigation.
- The Justice Department is conducting multiple criminal investigations into big banks with the cooperation of traders who have pleaded guilty to spoofing-related crimes.
Another former J.P. Morgan precious metals trader pleaded guilty Tuesday to criminal charges of manipulating the precious metals markets for nine years, marking the latest conviction in the Justice Department's crackdown in the commodities markets.
Christian Trunz, 34, of London is cooperating with an ongoing federal criminal investigation, the Justice Department said. He pleaded guilty to one count of conspiracy and one count of spoofing in the U.S. District Court in Brooklyn.
Spoofing is a strategy that involves placing trade orders with the intent to cancel them before they can be executed. The goal is to affect the price of the commodity and benefit a preexisting trading position.
In his guilty plea, Trunz admitted that from approximately July 2007 and August 2016 he "placed thousands of orders that he did not intent to execute for gold, silver, platinum and palladium futures contacts," according to officials.
Trunz, who earlier Tuesday resigned from his position as an executive director at J.P. Morgan, said he "learned to spoof from more senior traders, and spoofed with the knowledge and consent of his supervisors," according to the Department of Justice.
J.P. Morgan declined to comment.
The Justice Department is conducting multiple criminal investigations into big banks with the cooperation of traders who have pleaded guilty to spoofing-related crimes.
In the past five years, federal prosecutors have brought a total of 12 spoofing cases against 16 defendants. Most of those cases have ended with guilty pleas.
Trunz's guilty plea makes him the second former J.P. Morgan precious metals trader to admit to spoofing in the past ten months.
John Edmonds, 37, pleaded guilty in October in Connecticut federal court to working with other "unnamed co-conspirators" to manipulate the prices of gold, silver, platinum and palladium futures contracts between 2009 and 2015 while employed at J.P. Morgan.
Edmonds, like Trunz, admitted learning the illegal trading tactics from senior traders at the bank and to using those tactics with the knowledge and consent of supervisors.
Edmonds, who has yet to be sentenced in his criminal case, and several other traders who likewise have pleaded guilty to spoofing-related crimes are also cooperating with federal prosecutors in ongoing probes of major banks.
Trunz's sentencing is scheduled for Feb. 19, 2020.
Last February, J.P. Morgan first mentioned the legal actions in a financial disclosure: "Various authorities, including the Department of Justice's Criminal Division, are conducting investigations relating to trading practices in the precious metals markets and related conduct. The Firm is responding to and cooperating with these investigations."