Released on 13 May, the handbook is grounded in market practice. Our main contribution is the description of the methodology we use in our expert witness work to help identify prima facie evidence of market manipulation. This step by step methodology allows the trading data to tell the story and, if the data supports it, leads one to present a compelling case in the absence of a legitimate commercial explanation for the trading. This procedure is an important contribution since direct evidence of the intention to manipulate is often difficult to adduce. The procedure we implement in the chapter is based on our extensive experience working with various parties involved in allegations of market manipulation, whether regulators and prosecutors or defendants and intermediaries, and our independently developed algorithms with which to identify manipulation. The specific rules we present follow from a description of the legislative underpinnings of our work as expert witnesses and a summary of the relevant laws and regulations from jurisdictions in which we have worked. This regulation is then embedded into a discussion of trading activity with highlights of the key elements that motivate the actions of surveillance departments.
Now available: Corruption and Fraud in Financial Markets: Malpractice, Misconduct and Manipulation
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