London: Indian-origin 'flash crash' trader sent to custody
A British court on Wednesday remanded into custody an Indian-origin futures trader, arrested for his alleged role in the 2010 Wall Street "flash crash" which wiped nearly USD 1 trillion off the value of US shares in minutes, after he failed to pay 5.05-million euro bail.
Navinder Singh Sarao, 36, has been charged by the US Department of Justice with wire fraud, commodities fraud and market manipulation in relation to the crash that wiped hundreds of millions off US shares five years ago.
Sarao was granted conditional bail last week but at a hearing at Westminster Magistrates' Court he failed to meet the bail conditions.
The court has given him a further week until May 6 to meet the bail conditions, which include producing the bail money and staying restricted to his parents' house in Hounslow, south-west London.
He will also be banned to travel internationally or use the internet.
The US Department of Justice is seeking to extradite Sarao and a two-day hearing had been scheduled for August 18 and 19.
However, the court was told this date was no longer suitable and the hearing has now been moved to September 24 and 25.
Wearing a grey jumper and grey jogging trousers, the Brunel University graduate, who is alleged by US prosecutors to have made over USD 40 million through illegal trading on the futures market, spoke only to change confirm his name, date of birth and address.
Sarao was arrested by police a week ago and faces a jail sentence of up to 380 years if convicted of all the counts against him.
It is alleged that he used a high speed internet connection at his parent's London home to place a large number of fraudulent electronic orders to sell one type of financial contract.
He is then accused of cancelling the orders, forcing the prices back up again and taking profit from the price swing.
The US Department of Justice believes that these trades contributed to the flash crash of May 6, 2010, when the Dow Jones stock exchange lost 700 points in a matter of minutes, wiping USD 800 billion of the value of US shares, before recovering again.
Sarao, who denies the allegations, offered no explanation for his failure to meet bail.