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Federal prosecutors and authorities more generally have spent the better part of the last few years trying to demonstrate that spoofing—goosing the market you actually intend to trade in with a raft of rather large orders you have no intention of actually executing—is, in fact, illegal. And, like, properly, prison-worthy illegal, whatever those bleeding hearts at the U.S. Probation Office say.

And their efforts at spoofing spoofing into being a real crime are paying off: In spite of the fact that prosecutors’ success in proving such charges before a jury is somewhat less-than-impressive, they’ve put enough fear of god—and of five years in prison—into the alleged spoofers to achieve what they really wanted all along: An inducement for some nice, friendly, no-work guilty pleas.

A former Bank of America Corp. trader has pleaded guilty to spoofing, admitting to entering phony orders to try to influence the market for U.S. Treasurys…. In one example, [Tyler] Forbes attempted to sell $65 million in 10-year Treasury notes in May 2019 and placed a phony $250 million buy order, creating a false appearance of market interest, according to prosecutors./Mr. Forbes, who began his career with Bank of America in 2016 after studying at Colgate University, was involved in 194 instances of spoofing….

So, you know, better play nice, short-sellers. This shit is serious now.

Ex-BofA Treasury Note Trader Admits to Spoofing [WSJ]

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