Energy Metro Desk Editor John Sodergreen examined a recent Chicago Mercantile Exchange ("CME") notice that denied a trader access to all of its markets for 60 days during an ongoing "spoofing" investigation.

Mr. Sodergreen pointed to a CME assertion that while trading an account held in another's name, a trader repeatedly placed single orders for small quantities of gold and natural gas futures, followed by single orders for large quantities on the opposite side of such trades. The CME established that "[g]enerally, less than 100 milliseconds thereafter, the small-quantity orders traded and the large-quantity orders were canceled." Mr. Sodergreen questioned whether the activity constituted spoofing under the CFTC definition.

Mr. Sodergreen promoted an open forum sponsored by Energy Metro Desk on Sept. 9 at the National Press Club, to discuss spoofing and other anti-manipulation policies.

Click here to view an excerpt from the most recent issue of Energy Metro Desk's The Desk, which is published biweekly by Scudder Publishing Group, an energy trade news publishing company based in Washington, D.C.

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