Accused trader loses new bail bid

Navinder Singh Sarao, 36, the British financial trader accused of helping trigger a multibillion-dollar US stock market crash, has lost his High Court bid for bail while he fights extradition to America.

Today, Mr Justice Cranston, sitting in London, refused Mr Sarao's renewed application for bail, saying there was "a clear risk" of him taking flight.

US prosecutors claim that he and his company, Nav Sarao Futures Limited, illegally made £26 million ($40 million) over five years.

Navinder Singh Sarao, the British trader who is alleged to have caused a multi-billion dollar stock market crash, has been remanded in custody and given an extra seven days to raise money his £5m bail as he fights extradition to the US.

British trader Navinder Singh Sarao, accused of committing fraud during the 2010 "Flash Crash", has been granted conditional bail until May 26.

Sarao, 36, must remain at his home in Hounslow, west London, and provide a security of £5.05 million.

He was told he must provide £5 million - the amount he has in his trading account - along with a security of £50,000 from his parents, which they would lose if he failed to answer bail without good cause.

The US government will oppose the release of a British trader accused of helping to trigger a stock market crash, prosecutor Aaron Watkins told a London court.

Navinder Singh Sarao, who faces 22 charges in the US state of Illinois, told Westminster Magistrates' Court he will contest the extradition request.

The concern is that if admitted to bail he will fail to surrender and the reason for that is that he faces a very long custodial sentence if convicted of one or more of these offences," Watkins, who represents the US government, said.

"He has committed these crimes over a period of time. It is said he was asked to desist from these activities by the US authorities but failed to do so, knowing it was wrong," the prosecutor added.

A full extradition hearing in the case of a British trader accused of fraud in relation to the US "Flash Crash" of five years ago will take place in August, a judge has said.

"This has come as a bolt from the blue for Mr Sarao," Navinder Singh Sarao's lawyer Joel Smith told the court.

British trader Navinder Singh Sarao, accused of committing fraud during the 2010 "Flash Crash", has told a London court he does not consent to being extradited to the US and will contest the request.

Yesterday the US Justice Department said that it had criminally charged Sarao, 36, of London, with wire fraud, commodities fraud and manipulation.

The US Commodity Futures Trading Commission (CFTC) said it will find and prosecute market manipulators "wherever they may be."

CFTC director of enforcement Aitan Goelman said:

Goelman was speaking ahead of the court appearance of a British trader accused of "spoofing" trades in connection with the US stock market "Flash Crash" five years ago.

British trader Navinder Singh Sarao is accused of artificially manipulating the market by "spoofing", an illegal practice that sees fake trades placed and then cancelled in a matter of seconds.

Court documents filed in the US by the FBI claim Sarao carried out a spoof practice called "layering" - using "commercially available trading software" that allows traders to "communicate with markets as quickly as possible and to place, modify, and cancel multiple orders nearly simultaneously".

Although these electronic trades are cancelled before they are completed, they are in place long enough to have an effect on market prices.

US authorities allege Sarao's layering of "sell orders" on a Chicago futures market led to the "Flash Crash" of May 6, 2010, which saw the Dow Jones Industrial Average fall by around 600 points in five minutes and nearly 1,000 points in less than half an hour.

A British trader will appear in court today in connection with the stock market "Flash Crash" in the US five years ago.

The US is requesting the extradition of Navinder Singh Sarao, 36, of Hounslow, west London, for alleged fraud.

He is accused of using an "automated trading programme" to manipulate the market for E-Mini S&P 500 futures contracts (E-Minis) on the Chicago Mercantile Exchange. E-Minis are stock market index futures contracts based on the Standard & Poor's 500 Index.

This is said to have earned him significant profits and contributed to a major crash in the US stock market in May 2010.

It caused the Dow Jones Industrial Average fell by about 600 points in five minutes, following a drop in the price of E-Minis, the Justice Department said.

Sarao faces one count of wire fraud, 10 counts of commodities fraud, 10 counts of commodities manipulation, and one count of "spoofing", a practice of bidding or offering with the intent to cancel the bid or offer before execution.

He will before Westminster Magistrates Court in London this morning.