The US Commodity Futures Trading Commission (CFTC) [official website] on Thursday ordered [press release] Citigroup Global Markets Inc. (Citigroup) [corporate website] to pay over 25 million dollars for engaging in deceitful business trading practices. The CFTC found that Cigroup would place bids on the futures market with the intent to prematurely withdraw bids. This practice is called spoofing and violates the Commodity Exchange Act [official summary]. According to the CFTC:

The Traders placed their spoofing orders to create or exacerbate an imbalance in the order book. This created the impression of greater buying or selling interest than would have existed absent the spoofing orders and was done to induce other market participants to fill the Traders’ smaller resting orders on the opposite side of the market from the Traders’ spoofing orders in advance of anticipated price changes. The Traders cancelled their spoofing orders after either the smaller resting orders had been filled or the Traders believed that the spoofing orders were at too great a risk of being executed.

The landmark order [order, PDF] was a part of a settlement negotiation that not only requires Citigroup to pay a fine but also comply with regulations and immediately cease from the spoofing practice.

This order is the latest in a series of financial investment cases. JPMorgan Chase & Co agreed Wednesday to pay $55 million to settle a lawsuit [JURIST report] by the US Department of Justice. The US Court of Appeals for the Second Circuit in New York on Wednesday revived [JURIST report] a lawsuit that stems from the 2008 financial crisis. The US Supreme Court on Tuesday rejected an appeal [JURIST report] by several large banks asking to dismiss lawsuits brought by private investor groups accusing them of conspiring to manipulate the Libor benchmark interest rate.