Tower Research Capital Agrees to Pay $67 Million in Connection to Commodities Fraud Scheme
HOUSTON – Tower Research Capital LLC, a New York, New York-based financial services firm has entered into a resolution with the Department of Justice to resolve criminal charges related to a scheme involving thousands of episodes of unlawful trading activity in U.S. commodities markets by three former traders.
Tower entered into a deferred prosecution agreement (DPA) in connection with a criminal information filed in the Southern District of Texas (SDTX) charging the company with one count of commodities fraud. Under the terms of the DPA, Tower agreed to pay a combined $67.4 million in criminal monetary penalties, criminal disgorgement and victim compensation with the criminal monetary penalty credited for any payments made to the Commodity Futures Trading Commission (CFTC). Tower also agreed to, among other things, conduct appropriate reviews of its internal controls and policies and procedures and to modify its compliance program, where necessary, to ensure it is designed to deter and detect violations of the Commodity Exchange Act and commodities fraud statute.
“Traders at Tower Research Capital LLC fraudulently placed thousands of bogus orders they never intended to execute—to deceive other market participants and move the market for their own benefit,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division. “This agreement includes monetary penalties, the return of unjust profits and compensation of victims to protect our nation’s commodities markets from manipulation.”
“Free markets are not open and fair when people criminally manipulate them,” said U.S. Attorney Ryan K. Patrick of the Southern District of Texas. “Fraudsters like this will be prosecuted. This case also shows the department’s willingness to resolve cases when industry cooperates and remediates failures of internal controls.”
Read more: https://www.justice.gov/usao-sdtx/pr/tower-research-capital-agrees-pay-67-million-connection-commodities-fraud-scheme