Page 31 - 期货和衍生品行业监管动态（2022年12月）
P. 31
期货和衍生品行业监管动态
“ Manipulative and deceptive conduct undertaken in connection with swaps
harms market integrity and market participants, and we will take action to hold those
who commit this type of misconduct accountable, ” said Acting Director of
Enforcement Gretchen Lowe.
Case Background
The complaint alleges that the option contracts at issue, which are swaps under
the CEA, were tied to the U.S. dollar (USD) to South African rand (ZAR) exchange
rate. Under their terms, if the USD/ZAR exchange rate fell below certain levels at any
point during the life of the contracts, the contracts would pay out predetermined
amounts totaling $30 million to two commodity pools under the joint management of
Glen Point Capital.
On two occasions, in late December 2017, during a period of low market
liquidity (around Christmas time), Phillips engaged in a scheme to intentionally and
artificially drive down the USD/ZAR exchange rate to levels that would trigger
payouts on the option contracts. At that time, Phillips knew that only a few days
remained for the USD/ZAR exchange rate to hit the predetermined amounts or else
the contracts would expire, rendering them worthless. Rather than allowing free
market forces to determine whether the USD/ZAR exchange rate would breach the
predetermined amounts set by the contracts before they expired, Phillips orchestrated
the trading of massive amounts of the USD/ZAR currency pair in the foreign
exchange spot market for the express purpose of pushing the exchange rate down to
the exact levels he needed to trigger the contracts. Phillips’ scheme was successful
and directly resulted in $30 million in payouts for the pools under Glen Point Capital’
s management.
As further alleged, Phillips expressed his manipulative intent in messages he sent
to the bank that executed the spot trades. For example, during the first set of trades at
issue, Phillips explicitly told a salesperson at the bank his objective was to trade
through the rate of 12.50 rand per dollar — the barrier level that would trigger one of
15
