A federal appeals court in Chicago on Monday upheld the conviction of Michael Coscia, the first U.S. trader to face prison time for manipulating futures prices using "spoofing," the Wall Street Journal reported. "Spoofing" was made illegal in 2010 as part of the Dodd-Frank Act. Spoofing involves placing large orders intended to deceive other traders into thinking supply or demand has changed enough to bring about better market pricing on smaller trades made by the deceptive trader. The large orders are then canceled before execution. The court rejected Coscia's claim that his conviction should be overturned because the law is too vague to be enforced. "Mr. Coscia engaged in this behavior in order to inflate or deflate the price of certain commodities," the circuit judges wrote, according to the Journal. "His trading accordingly also constituted commodities fraud, the ruling said.
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