DOJ Accuses JPMorgan's Precious Metals Trading Desk Of Being A Criminal Enterprise

[Swordsmyth]

Who would have thought that JPMorgan's precious metals trading desk is the functional equivalent of the mafia, and that its one-time leader, Blythe Masters, was the mafia's don?
Well, almost everyone who didn't mind being designated a conspiracy theorist for years. And now comes vindication, because this has just been confirmed by the DOJ, which accused the PM trading desks at JPMorgan of being deeply involved in what prosecutors described as a "massive, multiyear scheme to manipulate the market for precious metals futures contracts and defraud market participants."
In an indictment unsealed on Monday (https://www.justice.gov/opa/pr/current-and-former-precious-metals-traders-charged-multi-year-market-manipulation) morning, the DoJ charged Michael Nowak, a JPMorgan veteran and former head of its precious metals trading desk and Gregg Smith, another trader on JPM's metals desk, in the probe. (Blythe Masters was somehow omitted).
“Based on the fact that it was conduct that was widespread on the desk, it was engaged in in thousands of episodes over an eight-year period -- that it is precisely the kind of conduct that the RICO statute is meant to punish,” Assistant Attorney General Brian Benczkowski told reporters.


Here's where it gets extra interesting: according to Bloomberg (https://www.bloomberg.com/news/articles/2019-09-16/jpmorgan-s-metals-desk-was-a-criminal-enterprise-u-s-says), the unusually aggressive language language embraced by prosecutors reminds legal experts of indictments utilizing the RICO Act - a law allowing prosecutors to take down 'criminal enterprises' like the mafia by charging all members of the organization for any crimes committed by an individual on behalf of the organization.
Prosecutors charged the head of JP Morgan’s global metals trading operation and two other traders with "conspiracy to conduct the affairs of an enterprise involved in interstate or foreign commerce through a pattern of racketeering activity" - language that is typically used to describe a RICO charge.
This hints at the possibility of a deeper prosecution for JP Morgan. Already, 12 people have been charged in the precious metals market-rigging conspiracy.

More at: https://www.zerohedge.com/markets/three-jpmorgan-traders-charged-massive-gold-market-manipulation-fraud

[Stratovarious]

No one would have ever guessed.
I also view most brokerage houses and their stock recommendations, performance ratings to be run as criminal enterprises.

[Swordsmyth]

Just two days after the DOJ took the unprecedented step (https://www.zerohedge.com/markets/three-jpmorgan-traders-charged-massive-gold-market-manipulation-fraud)of designating the JPMorgan precious metals trading desk as a "criminal enterprise" using unusually aggressive language which reminded legal experts of indictments utilizing the RICO Act, and which hopefully ended years of precious metal manipulation by the group formerly headed by Blythe Masters, CNBC (https://www.cnbc.com/2019/09/18/federal-prosecutors-regulators-broaden-market-manipulation-probe.html)now reports that the probe is set to spread significantly as Federal prosecutors and regulators "are expanding their already aggressive investigations of fraudulent precious metals trades at J.P. Morgan Chase to other U.S. markets and financial firms."
The inquiry into market manipulation of all kinds comes amid a spike in criminal prosecutions and civil actions in the past year involving so-called “spoofing” in the precious metals markets, which we now find had been taking place with reckless abandon for years at JPMorgan and virtually all other major banks.
The prosecutors broadened their investigation thanks to information received from traders questioned for spoofing-related charges, and as in most RICO cases, the information obtained from those traders has led to criminal charges against other individuals.
In short: what we for many years said was blatant manipulation of precious metals was precisely that, and now the participants in said manipulating cabal are being treated as a mafia syndicate by the DOJ.


The widening inquiry is being led by the Justice Department and the U.S. Commodity Futures Trading Commission as they continue their pursuit of individuals and firms for manipulating U.S. markets.
The crackdown may result in one of the biggest conviction rings for the DOJ since the financial crisis, with CNBC adding that the scope of the investigations has grown to the point where the criminal fraud division of the Justice Department expects to add personnel to the existing team to assist with the investigations and prosecutions of cases.
According to CNBC source, prosecutors now have an easier time identifying suspected spoofing due to advancements in the way the Department collects and analyzes trade data internally.

CNBC further adds that prosecutors are using information about suspected spoofing to collect additional evidence against a trader and, if warranted, question that trader about their own conduct and that of others. So far, the increased focus on spoofing has resulted in federal prosecutors bringing a total of 13 spoofing cases against 19 defendants in the past five years. Of those, eight have pleaded guilty, while seven are fighting the charges and awaiting trial.
Following the indictment of three J.P. Morgan precious metals traders on Monday, Assistant Attorney General Brian Benczkowski said that the Justice Department is not finished with its probes.
“Our investigation is ongoing, and we’re going to follow the facts wherever they lead whether it is across desks here or at any other bank or upwards into the financial institution,” Benczkowski said.

More at: https://www.zerohedge.com/commodities/regulators-expand-already-massive-precious-metals-manipulation-probe-other-markets

[Swordsmyth]

Just when you think it couldn't get any more embarrassing for JP Morgan's precious metals business and its embattled head, Michael Nowak, today it just did as the powerful London Bullion Market Association (LBMA) moved to oust Nowak, who has become too toxic, from the LBMA's board of directors.
According to (https://www.ft.com/content/4c0a9a9a-db85-11e9-8f9b-77216ebe1f17) the Financial Times:

"The London Bullion Market Association has removed Michael Nowak, JPMorgan’s head of precious metals trading, from its board after he was indicted by the US Department of Justice for a “massive, multiyear scheme” to manipulate the precious metals markets.
“In light of the ongoing investigation by the Department of Justice, the LBMA, under the terms of its Articles of Association, has removed Mr Nowak from its board,” the LBMA said.
The DoJ indictment is an embarrassment for the LBMA, which represents London’s precious metals market, and launched a code of conduct for its members in 2017.
Mr Nowak's name was no longer listed on the LBMA's website as of Friday."


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More at: https://www.zerohedge.com/commodities/gold-rigging-scandal-hits-lbma-jpmorgans-gold-manipulator-nowak-kicked-lbma-board

[oyarde]

:money::money::money::money::money::gamedie: