According the the Federal Bureau of Investigation and other regulatory authorities in the USA a chap working from his computer in his three bedroomed semi detached home in Hounslow five years ago managed to wipe trillions of dollars off share values five years ago. As a result they have issued a warrant for the arrest of Mr Navinder Singh Sarao on charges of wire fraud, commodities fraud and market manipulation and the UK authorities, subservient as usual to US demands, has geared its legal system to suit the requirements of the USA without getting anything back in reciprocation.
Mr Sarao can look forward to being extradited, and when he gets to the USA being bullied, threatened, cajoled and abused as well as lied to by the authorities seeking a conviction, which authorities take the line that when anything bad happens in the USA – Enron, sub prime fraud, banking crash, – there is usually a Briton at the bottom of it who must at all costs be punished to preserve the purity of the American dream.
In truth, Mr Sarao, who we must presume to be innocent, is simply another person who might have engaged in high frequency trading, in which billions of dollars of shares are “traded” every fractions of a second in the hope of making profits every fractions of a second which soon add up to a substantial sum.
I have no doubt that Mr Sarao is innocent of market manipulation. The regulatory authorities around the world are guilty of permitting market manipulation by permitting shares currencies and commodities to be bought and sold when there is no underlying demand or genuine hedging requirement. High frequency trading is simply the zenith of such actions which are economically damaging and serve no purpose save one to satisfy a urge to get wealthier by gambling in ways that one gambler has a distinct advantage over other gamblers.
I do not see how any high frequency trader is not manipulating the market and committing commodities and other frauds. The same applies to many modern methods of gambling which are now called “banking” or “investment”.