Former Moore Portfolio Manager To Pay $1 Million CFTC Penalty
Christopher Louis Pia, a former Moore Capital portfolio manager, has agreed to pay a $1 million civil penalty to settle charges with the Commodity Futures Trading Commission (CFTC).
A former Moore Capital portfolio manager has agreed to pay a $1 million civil penalty to settle charges with the Commodity Futures Trading Commission (CFTC).
Christopher Louis Pia was accused of attempting to manipulate the settlement prices of palladium and platinum futures contracts on the New York Mercantile Exchange (NYMEX) while with Moore Capital Management, the firm founded by Louis Bacon. It currently runs about $15 billion.
Pia was also permanently banned from trading CFTC-regulated products during the closing period of the markets and from trading CFTC-regulated products in platinum and palladium.
The CFTC’s order also requires Pia to distribute a copy of the CFTC order to current investors and to current and future employees, principals, and officers and to provide a disclosure document setting out the CFTC action to existing and prospective clients.
The CFTC elaborated that Pia caused to be entered market-on-close buy orders that were executed in the last 10 seconds of the closing period for both contracts in an attempt to exert upward pressure on the settlement prices of the futures contracts. The CFTC said Pia engaged in this trading strategy at Moore Capital frequently.
Under the CFTC order, a monitor must ensure Pia’s compliance with the order for five years.
In April 2010, Moore agreed to pay $25 million to settle charges by the Commodity Futures Trading Commission that it tried to manipulate the settlement prices of platinum and palladium futures contracts on the NYMEX. The CFTC also filed and settled charges that Moore failed to “diligently supervise” the handling of MCM’s commodity interest business.
Moore has since stressed neither Moore Capital’s principals nor its current management were involved in any improper trading, and none have been accused of any wrongdoing. Moore Capital also has said it cooperated fully with the CFTC in its investigation.