Bank Pays Hefty Fine for Fraudulent Trading Practices
- TD Securities pays over $6.5M in charges related to spoofing probe
- Former head of TD Securities desk, Jeyakumar Nadarajah, charged with making hundreds of illegal trades
- SEC orders disgorgement, prejudgment interest and civil penalty
- Spoofing involves manipulating stock prices for profit
- TD Securities failed to scrutinize potential irregular trading activity
- FINRA investigation led to enhanced monitoring and compliance capabilities
TD Securities has agreed to pay more than $6.5 million in charges related to spoofing, a form of fraudulent trading, brought against the bank by the Securities and Exchange Commission (SEC). The SEC also charged the bank for failing to supervise Jeyakumar Nadarajah, former head of TD Securities’ U.S. Treasuries desk, who allegedly made hundreds of illegal trades over a 13-month period. Spoofing involves flooding the market with fake orders to manipulate stock prices for profit. The bank consented to the SEC’s order and was required to cease future violations and pay $400,000 in disgorgement, prejudgment interest, and a $6.5 million civil penalty. TD Securities has taken action against Nadarajah’s behavior, reporting it to FINRA, terminating his employment, and enhancing monitoring and compliance capabilities since 2017.
Factuality Level: 8
Factuality Justification: The article provides accurate information about the charges against TD Securities, the actions taken by the SEC, and the bank’s response to the situation. It also includes relevant details about the individual involved and related investigations.
Noise Level: 3
Noise Justification: The article provides relevant information about the charges against TD Securities and the actions taken by the bank in response to the fraudulent trading activity. It also includes quotes from the SEC and TD Securities’ statement. However, it does not delve into long-term trends or possibilities, hold powerful people accountable, explore consequences on those who bear risks, provide antifragility, or offer actionable insights.
Public Companies: TD Securities (TD)
Key People: Jeyakumar Nadarajah (Former head of the TD Securities desk responsible for trading U.S. Treasuries), Mark Cave (Associate Director, SEC Division of Enforcement)
Financial Relevance: Yes
Financial Markets Impacted: TD Securities
Financial Rating Justification: The article discusses TD Securities being charged with fraudulent trading practices (spoofing) and having to pay a significant amount in penalties, which impacts the bank’s financial standing and reputation. This directly pertains to financial topics and has an impact on the company itself.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: No extreme event in the text and it did not happen in the last 48 hours.
Move Size: No market move size mentioned.
Sector: Finance
Direction: Down
Magnitude: Large
Affected Instruments: Stocks, Bonds
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