Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

United States v. Flotron

United States District Court, D. Connecticut

March 20, 2018

UNITED STATES OF AMERICA, Plaintiff,
v.
ANDRE FLOTRON, Defendant.

          ORDER DENYING MOTION TO DISMISS SUPERSEDING INDICTMENT

          Jeffrey Alker Meyer United States District Judge

         This is a criminal case about an alleged conspiracy to engage in commodities fraud involving the trading of precious metals futures contracts. Defendant Andre Flotron has filed a motion to dismiss the superseding indictment. I conclude that the indictment properly alleges the legal requisites and facts to establish an unlawful conspiracy to commit commodities fraud. I further conclude that the superseding indictment is not unconstitutionally vague. Accordingly, I will deny defendant's motion to dismiss.[1]

         Background

         The superseding indictment alleges that defendant traded in futures contracts for precious metals on behalf of UBS AG, one of the world's largest banking and financial services companies. According to the indictment, “a precious metals futures trader can defraud market participants by bidding to buy or offering to sell precious metals futures contracts with the intent, at the time the bid or offer is placed, to cancel the bid or offer before it is executed.” Doc. #58 at 3 (¶ 9). The indictment explains how such a practice-known as “spoofing”-may be used to defraud market participants:

a. A trader places one or more large orders either to buy or to sell certain futures contracts which the trader intends to cancel before they are executed (the “Trick Orders”). To drive prices up, the trader places Trick Orders to buy, which create the false impression in the market of increased demand. To drive prices down, the trader places Trick Orders to sell, which create the false impression in the market of increased supply.
b. In conjunction with the Trick Orders, the same trader also places, on the opposite side of the market, one or more orders in a much lower quantity that the trader actually intends to execute (the “Genuine Orders”).
c. Other market participants react to the false impression created by the Trick Orders by offering to buy or sell at prices, quantities, and at times that they otherwise would not. This, in turn, often causes the market price of a given futures contract to rise or fall.
d. When the market prices changes as a result of the Trick Orders in a manner, and to a degree, that the trader intends, the trader's Genuine Orders are often filled at favorable prices, quantities, and at times that otherwise would not have been available, but for the Trick Orders.

Doc. #58 at 3-4 (¶ 10).

         The indictment goes on to allege that defendant and co-conspirators engaged in such practices for more than five years. It alleges that “[t]he Trick Orders placed by FLOTRON and his co-conspirators frequently, and fraudulently, induced other market participants to place offers to buy or bids to sell precious metals futures contracts at prices, quantities, and at times that they otherwise would not, driving up or down the price of those precious metals futures contracts and causing FLOTRON's and his co-conspirators' Genuine Orders to be filled.” Id. at 5-6 (¶ 17). The indictment further alleges that “[b]etween approximately July 2008 and approximately November 2013, FLOTRON and his co-conspirators placed hundreds of Trick Orders for precious metals futures contracts in an effort to cause Genuine Orders placed by FLOTRON and his co-conspirators to be filled at prices, quantities, and at times that they otherwise would not.” Id. at 6 (¶ 20).

         Discussion

         It is well established that an indictment is legally sufficient if it tracks the elements of the offense and alleges facts with sufficient precision to give a defendant fair notice of the charge he must meet. See, e.g., United States v. Bout, 731 F.3d 233, 240 (2d Cir. 2013). Moreover, when an indictment alleges a conspiracy, it need not allege with technical precision all the elements essential to the commission of the crime that is the object of the conspiracy. Ibid.

         Defendant does nothing to suggest that the indictment here fails at a technical level to allege the requisite elements of the conspiracy crime or that it otherwise fails to give him fair notice as a factual matter of what the prosecution alleges that he did wrong. Defendant contends instead that the facts as alleged in the indictment do not amount to the crime of commodities fraud. He argues that he made no false or fraudulent representation to any market participant and that every buy or sell order he placed into the market was a bona fide order that was available to be traded upon by any market participant until later cancelled before execution. By his reckoning, even if the Government proves every fact it has charged in the indictment, he has committed no crime.

         It is true that an indictment may be subject to dismissal if the facts it alleges do not amount to the charged crime. Nevertheless, a fact-based challenge to an indictment is not a permissible vehicle for the Court to scrutinize the anticipated sufficiency of the Government's evidence, because the Government is entitled to marshal and present its evidence at trial subject to a proper challenge for sufficiency under Fed. R. Crim. P. 29. Accordingly, my role at this pre- trial stage is solely to determine whether, assuming all of the facts as alleged in the indictment are true, a ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.