The Commodity Futures Trading Commission (CFTC) announced that the U.S. District Court for the District of Nevada has sanctioned Daniel Shak of Las Vegas, Nevada, for engaging in spoofing and manipulative schemes in the gold and silver futures markets. The court entered a consent order on April 9, resolving the charges brought against Shak by the CFTC.
According to the CFTC, Shak has been imposed with a $750,000 civil monetary penalty and is permanently prohibited from trading in commodity interests or registering with the CFTC in any capacity. Additionally, he is required to cease and desist from violating the Commodity Exchange Act's prohibitions on spoofing and manipulative schemes.
Ian McGinley, the CFTC Director of Enforcement, highlighted the significance of the penalty imposed on Shak, stating, "The penalty and permanent trading ban imposed here demonstrate there is no place for recidivism in CFTC regulated markets, and the CFTC will impose substantial penalties to achieve appropriate deterrence."
The order against Shak found that from February 2015 through March 2018, he engaged in manipulative or deceptive acts by spoofing in the gold and silver futures markets. Shak would place large orders with the intent to cancel them before execution, while simultaneously placing orders on the opposite side of the market. This strategy aimed to deceive market participants into executing orders that favored Shak's positions.
The CFTC expressed gratitude towards CME Group Inc. for their assistance in the matter. The Division of Enforcement staff involved in the case included Brian Hunt, James Holl III, Maura Viehmeyer, Erica Bodin, Elizabeth May, Jordon Grimm, and Rick Glaser, with additional support provided by the Spoofing Task Force.
This latest sanction against Daniel Shak adds to his history of enforcement actions in the commodity markets. In 2013, he was sanctioned for attempted manipulation in the Light Sweet Crude Oil futures contracts, and in 2015, he faced penalties for violating the terms of a CFTC order.
As regulatory bodies continue to crack down on market manipulation and deceptive practices, cases like Shak's serve as a reminder of the consequences individuals may face for engaging in such activities.
