More on J.P. Morgan

I would strongly recommend that both Bob Moriarty and Chris Temple read this article. Big Al asks them the question:”Just more fantasy stories, guys?” I realize that neither one of you guys particularly cares for Murphy, but remember that all he did was quote the story as published by Bloomberg. But then again, you two seem to get a kick out of bringing shame to Big Al. Fortunately for him this time your efforts backfired.

Two current and one former JPMorgan Chase employees have been arrested and charged by the FBI for their alleged participation in a racketeering conspiracy in connection with the manipulation of the markets for precious metals.

Michael Nowak, 45, and Gregg Smith, 55, are on leave, making them the third and fourth JPMorgan employees to be connected to the criminal investigation, which  has resulted in guilty pleas from two former JPMorgan metals traders. 

Christopher Jordan, 47, who left the company in 2009, was an executive director and trader on JPMorgan’s precious metals desk in New York. 

All three were arrested as part of a spoofing investigation. Spoofing involves placing bids to buy or offers to sell contracts with the intent to cancel them before execution.

By creating an illusion of demand, spoofers can influence prices to benefit their market positions. 

‘The defendants and others allegedly engaged in a massive, multi-year scheme to manipulate the market for precious metals futures contracts and defraud market participants,’ said Assistant Attorney General Brian A. Benczkowski.  

Authorities said the alleged criminal activity spanned over eight years and involved thousands of unlawful trading sequences.

Nowak is a managing director and global head of base and precious metals trading in New York for the bank, according to his LinkedIn profile. 

According to the source, Nowak was placed on leave around late August. Smith was an executive director and trader on JPMorgan’s precious metals desk in New York. 

Authorities said in the thousands of sequences, the employees ‘placed deceptive orders for gold, silver, platinum and palladium futures contracts traded on the New York Mercantile Exchange Inc and Commodity Exchange Inc, which are commodities exchanges operated by CME Group Inc’. 

‘This false and misleading information was intended to, and at times did, trick other market participants into reacting to the apparent change and imbalance in supply and demand by buying and selling precious metals futures contracts at quantities, prices and times that they otherwise likely would not have traded’, the indictment alleges. 

JPMorgan, one of the largest gold trading banks in the world, said in an August regulatory filing it is ‘responding to and cooperating with’ investigations by various authorities, including the Department of Justice, relating to trading practices in the metals markets.

There has been a surge in spoofing-related prosecutions in recent years.

Bank of America Corp’s Merrill Lynch commodities unit, for example, paid $25million in July to resolve actions by the US Commodities Futures Trading Commission and Department of Justice for precious metals spoofing trades between 2008 and 2014.

The Department of Justice already secured guilty pleas from two former JPMorgan metals traders, Christiaan Trunz and John Edmonds. 

Authorities said in the thousands of sequences, the employees ‘placed deceptive orders for gold (file image), silver, platinum and palladium futures contracts traded on the New York Mercantile Exchange Inc and Commodity Exchange Inc

The announcement of their pleas, in August 2019 and October 2018, respectively, indicated that they had collaborated on spoofing with their supervisors, who were not named.

Trunz placed ‘thousands’ of orders he did not plan to execute for gold, silver, platinum and palladium futures contracts between 2007 and 2016, and had learned to spoof from more senior traders, the Department of Justice said in August, adding that he was cooperating with ‘the ongoing investigation’.

Nowak and another former JPMorgan trader, Robert Gottlieb, are named as defendants in at least one other civil suit related to metals spoofing at JPMorgan. 

A December 2018 class action complaint, for example, said that Edmonds, Nowak, Gottlieb and others made hundreds of spoof orders or more as ‘part of a conspiracy’ with the bank and other internal traders.

An attorney for Gottlieb did not respond to a request for comment. Koch Industries Inc, Gottlieb’s last known employer, did not immediately respond to a request for comment. 

JPMorgan has also been sued separately by a group of investors, who said they lost money as a result of the bank spoofing its trades. 

In one of the lawsuits brought against the bank by Daniel Shak, a metals trader, Shak estimated he suffered immediate losses of around $25million after he was forced to liquidate his position as a result of JPMorgan’s market manipulation, a court document showed.

The civil suits against JPMorgan have been stayed pending the Department of Justice probe. 

Attorneys for Nowak did not respond to a request for comment. 

A call to Smith’s number at the bank was answered by an employee at the metals desk who directed questions to the bank’s public relations department. A spokesman for the Department of Justice declined to comment.

All three defendants were charged with one count of conspiracy to conduct the affairs of an enterprise involved in interstate or foreign commerce through a pattern of racketeering activity; one count of conspiracy to commit wire fraud affecting a financial institution, bank fraud, commodities fraud, price manipulation and spoofing; one count of bank fraud and one count of wire fraud affecting a financial institution. 

In addition, Smith and Nowak were each charged with one count of attempted price manipulation, one count of commodities fraud and one count of spoofing. 

Sean Brodrick – Tue 17 Sep, 2019

The NY Fed is worried about the rising short term rates

Sean Brodrick joins me today to share a recent news story about the NY Fed stepping into the repo market to control the rising short term rates. We also look at the gold and oil markets as well as the copper market. There are still some diehard copper bulls that will point to what will drive the copper market however it’s all about time frame from smart investors.

Click here to visit the Weiss website and learn more about Sean’s newsletters.

David Erfle – Gold Market Commentary – Tue 17 Sep, 2019

Geopolitics pushing gold higher but a Fed statement tomorrow could have the PMs moving lower

Dave Erfle, Founder of the Junior Miner Junky joins me to look at the bounce in gold this week on the back of the oilfield bombings over the weekend. The bounce in gold and silver is nice to see but has not been a skyrocketing move. There are a couple reasons for this which we discuss. Still all eyes will be on the Fed statement tomorrow and with the set up in US markets and some of the recent data we could see a more hawkish Fed even with a rate cut.

You can even hear baby Gigi in the background at the 8-minute mark sharing her thoughts 😉

Click here to visit Dave’s site and at least sign up for his free email list.

Ed Moya – Senior Market Analysts at OANDA – Tue 17 Sep, 2019

The Geopolitical dark clouds over the Oil sector and the upcoming Fed meeting

Ed Moya, Senior Market Analyst at OANDA joins me for a look at the volatility in the oil price and the upcoming Fed statement tomorrow. With geopolitical dark clouds hanging over a number of markets we are seeing investors continue to diversify into a wide range of assets. As for the Fed, they are very market reactive and even with markets near all time highs and recent inflation data at and above the 2% target the expectation is still for a 25 basis point cut.

Click here to visit the OANDA website and follow along with what Ed is writing about.

Bill Murphy and Chris Powell are back as Gata is back in the news.

Bill ‘Midas’ Murphy monitors Precious Metals markets and has been bringing daily analysis and commentary to our subscribers here at LeMetropole Cafe for over 19 years.

Upon graduating Cornell University in 1969 Bill became a starting wide receiver for the Boston Patriots. After leaving football he went on to a career in the futures industry as a commodities broker. Early on he worked for Shearson Hayden Stone and Drexel Burnham before starting up his own introducing brokerage on 5th Avenue in New York. His past experience in the futures arena, and valuable market connections, led to his understanding of the gold/silver price suppression scheme, and what it would mean for future prices.
Big Al says: “Nothing would make me happier than to see vindication for Murph and Chris“!

Richard Postma – The Doctor Is In – Mon 16 Sep, 2019

What will it take for gold stocks to catch up to gold?

Doc joins me today to share his thoughts on the moves in gold and gold stocks. While gold has broken to over 6 year highs but the stocks have not been able to break above the 2016 highs. It’s an encouraging environment for the stock but what will it take to drive them to break out?

Chris Temple from The National Investor – Mon 16 Sep, 2019

Geopolitics now impacting the oil market… What to watch for is this escalates

Chris Temple, Founder of the National Investor joins me for a look at the significance of the recent attacks on the Saudi oilfields over the weekend. This is causing the price of crude to spike however it very well could be very short lived. What’s important for investors is to look at an reaction from other countries especially the US. Also will this bounce have any impacts on future economic data?

Click here to visit Chris’s site – The National Investor.

Company Updates From Management – Mon 16 Sep, 2019

Riverside Resources – Diving into the acquisition of the Los Cuarentas Project from Millrock Resources

Last week Riverside Resources (TSX.V:RRI, OTCQB:RVSDF, FSE:R99) announced it has completed the acquisition of the Los Cuarentas Project in Senora Mexico. John-Mark Staude, Riverside President and CEO joined me to provide some history on the project as well as discuss the overall district. We address if this project fits into the exploration alliance the Company has with BHP in Senora and what work is planned to build up drill targets.

If you have any follow up questions for John-Mark or I please email me at Fleck@kereport.com.

Click here to visit the Riverside website and read over the full news release.

Company Updates From Management – Mon 16 Sep, 2019

Riverside Resources – Diving into the acquisition of the Los Cuarentas Project from Millrock Resources

Last week Riverside Resources (TSX.V:RRI, OTCQB:RVSDF, FSE:R99) announced it has completed the acquisition of the Los Cuarentas Project in Senora Mexico. John-Mark Staude, Riverside President and CEO joined me to provide some history on the project as well as discuss the overall district. We address if this project fits into the exploration alliance the Company has with BHP in Senora and what work is planned to build up drill targets.

If you have any follow up questions for John-Mark or I please email me at Fleck@kereport.com.

Click here to visit the Riverside website and read over the full news release.