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There's simply no limit to how far Wall Street will go to make a buck.
It's no wonder. With corporate offenses and "bad behavior" routinely going unpunished, perpetrators have developed a sense of immunity.
But just weeks ago there was an indictment in a case of alleged manipulation of commodities futures.
It's the first ever federal prosecution for "spoofing," a tactic I recently discussed.
While we wait to see if it either sets the tone for a wider crackdown or proves to be little more than a slap on the wrist, we can also take the opportunity to profit.
Here's how we're going to play a non-bank investment against a rigged services industry…
This Fed Action Is a Step in the Right Direction… Will It Stick?
In a recent article I told you how you could turn the tables on the market manipulators.
Essentially, we discussed how the CME Group (one of the largest options and futures exchanges) was implementing new rules to eliminate "disruptive practices" and "market rigging."
Now we have news of the first ever federal prosecution of its kind for just such infractions.
The U.S. Attorneys' Office posted a press release indicating that "a high-frequency trader was indicted for allegedly manipulating commodities futures prices and illegally profiting nearly $1.6 million as a result of trading orders he placed through CME Group and European futures markets in 2011."
More specifically, the registered commodities trader was hit with six counts of commodities fraud and six counts of "spoofing." You'll remember that the CME's new rules make it unlawful to engage in "spoofing," which is the bidding or offering with the intent to cancel the bid or offer before execution.
In this first indictment, the trader "designed two computer programs he allegedly used in 17 different CME Group markets and three different markets on the London-based ICE Futures Europe exchange, including gold, soybean meal, soybean oil, high-grade copper, Euro FX, and Pounds FX currency futures, to implement his fraudulent strategy."
I'll spare you further details, but suffice it to say that his strategies involved high-frequency trading and were quite elaborate.
Of course, the next question a reasonable person would ask is, is this indicative of a new trend? Is it a watershed moment, or just a blip?
Remember too that, for now, it's still only an indictment.
I'll admit it's an encouraging sign that we can work our way towards at least freer markets.
But, given their recent history, especially in the wake of the 2008 financial implosion, you'll forgive me for doubting a serious crackdown will ever apply to the "banksters" with the same intensity as a lone trader.
Instead, they have extensive track records of neither admitting nor denying guilt, and escaping instead with a negotiated fine.
Given their propensity to generate bloated profits from massive leverage and fractional reserve banking, those fines are simply a tiny cost of doing "business as usual."
Still, this indictment appears to be a step in the right direction.
Only time will tell just how serious regulators are, and how level a playing field they really want.
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About the Author
Peter Krauth is the Resource Specialist for Money Map Press and has contributed some of the most popular and highly regarded investing articles on Money Morning. Peter is headquartered in resource-rich Canada, but he travels around the world to dig up the very best profit opportunity, whether it's in gold, silver, oil, coal, or even potash.