UK Trader, aka’Hound of Hounslow’, accused of causing financial crash could be extradited to US to stand trial – Navinder Singh Sarao to face charges in US over allegations he contributed to 2010 Wall Street “Flash Crash”
Trader dubbed ‘Hound of Hounslow’ accused of causing financial crash could be extradited to US to stand trial
Navinder Singh Sarao, 37, is wanted in America over allegations that he contributed to the 2010 Wall Street “Flash Crash”
The FBI didn’t only accuse Sarao of placing fake orders to manipulate the market, it also accused him of helping to cause the flash crash
Alleged illegal earnings of $875,000 on May 6, 2010, the day of the crash, part of more than $40 million over a five-year period
Faces 22 charges, with possible sentences totaling a maximum of 380 years.
British trader Navinder Singh Sarao leaves Westminster Magistrates court in London, UK after an extradition hearing
A British financial trader accused of helping trigger a multibillion-dollar Wall Street crash from a suburban UK home has lost a High Court challenge against a decision that he can be extradited to the US to stand trial.
At an extradition hearing at Westminster Magistrates’ Court in March, District Judge Quentin Purdy ruled that the Londoner,Navinder Singh Sarao, dubbed the Hound of Hounslow, could be sent to stand trial in the US.
Sarao, 37, dubbed the Hound of Hounslow, is wanted in America over allegations that he contributed to the 2010 Wall Street “Flash Crash” from his parents’ home 3,500 miles away in west London.
US authorities claim he made $875,000 on May 6, 2010, the day of the crash, part of alleged illegal earnings of more than $40 million amassed over a five-year period.
He faces 22 charges, which carry sentences totaling a maximum of 380 years.
Navinder Sarao is accused of causing a Wall Street crash
Attorneys for the former bank worker student argue that his actions did not constitute a crime. However, two judges at the High Court in London on Friday refused to give him permission to challenge the extradition order.
Sarao, who is on bail, was not present for the ruling by Lord Justice Gross and Mr Justice Nicol. Lord Justice Gross, announcing the decision to refuse permission, said the court would give its reasons at a later date.
The hearing centered on the legal issue of “dual criminality”.
In his ruling in March, Judge Purdy said: “The causes of the Flash Crash are not a single action and cannot on any view be laid wholly or mostly at Navinder Sarao’s door, although he was active on the day. In any event this is only a single trading day in over 400 relied upon by the prosecution.”
He said: “Essentially, has the USA established that the same actions in this jurisdiction at the same time would be capable of being prosecuted for one or more offences known to the criminal law?
Affirming the US feds case, Judge Purdy said: “This is not the forum for testing the evidence as in a trial. To my mind, when all is said and done, the USA are correct in arguing they have shown dual criminality.”
On May 6, 2010, the Flash Crash saw the Dow Jones Industrial Average plunge 600 points in five minutes, wiping tens of billions of pounds off the value of US shares.
Lord Justice Gross said during Friday’s hearing that “in reality this case is about five years of alleged market manipulation, not about the Flash Crash”.
Navinder Singh Sarao leaving Court
Mr Justice Nicol said that what the district judge had to decide was whether the conduct alleged by the US “constituted fraud as a matter of English law”.
Addressing the court, attorney for Sarao, James Lewis told the two judges: “No-one has ever been prosecuted for this conduct in the UK, ever. You are dealing with something that is completely novel.”
That it now appeared “academic commentary is united in the view that Sarao’s activity had little or nothing to do with causing the Flash Crash”.
The charges faced by Sarao include wire fraud, commodities fraud and “spoofing” – a practice of bidding or offering with the intent to cancel the bid or offer before execution.
Mark Summers, representing the US extradition challenge to the Saroa’s application argued that the case was about “spoofing over an extended period”.
He told the judges: “The US is ready to proceed to trial.”
Leading extradition lawyer Edward Grange, commented: “Having had his renewed application for leave to appeal refused, Sarao has now exhausted all domestic avenues of appeal.”
Extradition “will ordinarily now take place within 28 days from today”, he added.
“It is, of course, open to Sarao to lodge an application to the European Court of Human Rights but his chances of obtaining interim relief preventing his extradition are remote.”
Navinder Singh Sarao, allegedly made $40 million in the stock market crash of 2010, trading from his home
Navinder Sarao, who traded from his parents’ home in Hounslow, west London, has been accused of market manipulation that caused a 1,000-point fall on the US Dow Jones index in 2010.
He faces 22 charges in US courts, including fraud charges, which include “spoofing” or the practice of buying or selling with the intent to cancel the transaction before execution.
Observers note that though Navinder Sarao denies all charges of fraud, what he accomplished is astonishing.
From a computer in the bedroom he’d grown up in, at his parents’ home in Hounslow, the 37-year old traded remotely on an exchange in Chicago he had never visited. In less than five years he made more than $40m.
In 2010 he set up a company on the Caribbean island of Nevis called “Nav Sarao Milking Markets Limited”.
He made $40million without leaving his bedroom or indulging in a single ostentatious luxury. Sarao has heeded the advised of his attorneys against any public statements, so little is known about him. Regarded as bright and sociable at school, he has not been convicted of any other offences. According to his lawyers he has a severe version of Asperger’s syndrome.
He was locked up for four months from April to August 2015 because he could not meet bail conditions – his assets had been frozen by feds. This singular fact prompted an outburst in court where he stood up behind the glass-fronted dock and turned to the courtroom protesting “how is this allowed to happen? I’m being punished for being good at my job!”
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