Finally. The CFTC and Optiver reached at settlement for the manipulation of oil prices in 2007. The firm didn’t do anything wrong at all, but is nevertheless very happy to pay 14 million in penalties.
Optiver has traded certain contracts which settle at the closing price (TAS contracts). The firm has manipulated this closing price with their specially designed piece of software, the Hammer. Smart name. But even worse than the name were their quotes on a taped line. My favorite shared wisdom in the legal files remains:
“You should milk it for right now because you never know how long it’s going to last”.
The key suspects have left the firm (fired). Christopher Dowson, Randal Meijer and Bastiaan van Kempen are banned anyway from trading commodities in the US for eight, four and two years. They couldn’t care less, I suppose.
Optiver on the other hand, is limited from trading in some contracts. Or can’t trade those TAS contracts anymore. The penalty is more or less the same as the provisions in their books.