CFTC action against former Deutsche Bank traders to continue without DOJ intervention
The legal proceedings brought by the United States Commodity Futures Trading Commission (CFTC) against former Deutsche Bank traders James Vorley and Cedric Chanu will continue without the intervention of the Department of Justice (DOJ).
The Honorable Steven C. Seeger of the Illinois Northern District Court has signed an order granting the motion by the DOJ to withdraw as an intervenor in the CFTC case. The United States’ interest in seeking to stay discovery in this case is moot. Accordingly, the DOJ requested to withdraw as intervenor.
Let’s recall that the CFTC case against James Vorley and Cedric Chanu was launched in January 2018. The regulator charged them with spoofing and engaging in a manipulative and deceptive scheme in the precious metals futures markets.
The CFTC Complaint alleges that beginning in at least May 2008 and continuing through at least July 2013, while employed at Deutsche, Vorley and Chanu engaged in a manipulative and deceptive scheme while placing orders and trading in the precious metals futures markets on a registered entity. Specifically, in furtherance of the scheme, Vorley and Chanu repeatedly engaged in manipulative or deceptive acts and practices by spoofing (bidding or offering with the intent to cancel the bid or offer before execution).
Earlier in November 2021, the traders sought to dismiss the CFTC claims.
The defendants note that the CFTC alleges that the traders engaged in so-called “spoofing” prior to January 26, 2013. The CFTC brought it claims under the Commodities Exchange Act (CEA). The statute of limitations for those claims is five years, pursuant to 28 U.S.C. § 2462. The only condition that Section 2462 imposes is that, within the five-year limitations period, the defendant be “found within the United States in order that proper service may be made thereon.”
The traders explain that the CFTC delayed filing its Complaint until January 26, 2018, which means that only alleged spoofing that occurred after January 26, 2013, falls within the applicable five-year limitations period. To the extent the CFTC’s claims are based on alleged spoofing prior to that date—i.e., all the alleged spoofing by Vorley and Chanu (except for a couple of instances after that date) the claims should be dismissed as time-barred, the traders say.
The lawsuit continues at the Illinois Northern District Court.