Antitrust Law Daily Convicted currency trader lost motion for acquittal or new trial
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Tuesday, July 7, 2020

Convicted currency trader lost motion for acquittal or new trial

By Nicole D. Prysby, J.D.

Sufficient evidence supported a jury verdict that a former currency trader participated in an unlawful conspiracy to fix, process, and rig bids in the global FX market.

There was more than enough evidence from which the jury could conclude beyond a reasonable doubt that a former currency trader was guilty of participation in an unlawful conspiracy to fix prices and rig bids in the global foreign exchange (FX) market, the federal district court in New York City has ruled. The currency trader moved for a judgment of acquittal notwithstanding the jury verdict and in the alternative for a new trial. The court rejected the trader’s arguments and concluded that evidence adduced at trial was sufficient for the jury to find, beyond a reasonable doubt, that the conspiracy to fix prices and rig bids alleged in the indictment actually existed and that the defendant knowingly joined that conspiracy. Testimony from co-conspirators was clear and unambiguous that a conspiracy to fix prices and rig bids in the FX market existed. That credible testimony was supported by the evidence of the individual transactions and evidence of certain communications between the defendant and his alleged coconspirators that demonstrated that the coconspirators had a unity of purpose with respect to fixing prices and rigging bids in the FX market (U.S. v. Aiyer, July 6, 2020, Koeltl, J.).

Former JP Morgan Chase & Co. currency trader Akshay Aiyer was convicted of conspiring to fix prices for emerging market currencies in the global foreign exchange (FX) market. The Justice Department alleged that he engaged in near-daily communications with co-conspirators by phone, text, and through an exclusive electronic chat room to coordinate trades of the Central and Eastern European, Middle Eastern, and African (CEEMEA) currencies in the FX spot market. The conspirators agreed to withhold bids or offers to avoid moving the exchange rate in a direction adverse to open positions held by co-conspirators and by coordinating their trading to manipulate the rates in an effort to increase their profits. A jury found Aiyer guilty on a single count of conspiracy to restrain trade in violation of the Sherman Act, the Justice Department’s Antitrust Division announced. Aiyer moved for a judgment of acquittal notwithstanding the jury verdict and in the alternative for a new trial.

The court held that there was sufficient evidence introduced at trial for the jury to have found that Aiyer was guilty. Evidence included testimony from his alleged co-conspirators, Reuters trading data, Bloomberg chat transcripts, and expert testimony in which experts analyzed the trading episodes and explained for the jury what was happening in the trading episodes. The jury heard detailed evidence of numerous specific instances of bid coordination between Aiyer and co-conspirators, including one instance in which a co-conspirator said that "conspiracies are nice" and Aiyer responded "hahaha prolly shudnt puot this on perma chat."

The court rejected Aiyer’s argument that the trading events in the case did not constitute per se violations of the Sherman Act and that the court was required to perform an economic analysis of the trades at issue to determine their impact. The only relevant question was whether the evidence adduced at trial was sufficient for the jury to find, beyond a reasonable doubt, that the conspiracy to fix prices and rig bids alleged in the indictment actually existed and that the defendant knowingly joined that conspiracy, according to the court. And in this case, the evidence established beyond a reasonable doubt that a conspiracy existed whose object was to fix prices and rig bids in the FX market for CEEMEA currencies.

Testimony from co-conspirators was clear and unambiguous that a conspiracy to fix prices and rig bids in the FX market for CEEMEA currencies existed. That credible testimony was supported by the evidence of the individual transactions and evidence of certain communications between the defendant and his alleged coconspirators that demonstrated that the coconspirators had a unity of purpose with respect to fixing prices and rigging bids in the FX market for CEEMEA currencies. Even if some of the methods used to further the conspiracy were legal (such as interdealer transactions), they were used as the means to effectuate the unlawful conspiracy and the means and methods by which an unlawful conspiracy is carried out do not need to be unlawful in and of themselves if used to further the unlawful agreement. The court also rejected Aiyer’s argument that he was in a vertical, not horizontal, relationship with one co-conspirator who was more skilled at pricing the Russian ruble and Polish zloty. The fact that one party is allegedly more skilled in the given market does not alter the horizontal nature of a conspiracy where the co-conspirators occupy the same level of the market structure and compete for the same customers.

The court also rejected all arguments made by Aiyer in support of a new trial. Evidence of ruble and zloty trading, evidence of interdealer transactions, and evidence of "spoofing" or canceled trades were all properly presented to the jury, and the introduction of that evidence did not constitute a manifest injustice. The legal standard presented to the jury was proper and there was no likelihood of confusion from the jury having heard evidence from co-conspirators that the conduct was "wrong" because the court explained to the jury that conduct described by witnesses as "wrong" or likely to make customers "angry" "does not constitute the crime of conspiracy charged in this case unless that conduct was in furtherance of a conspiracy to fix prices and rig bids.

The government’s summations of the case did not result in substantial prejudice, the court reasoned. Alleged evidence of procompetitive justifications for conduct at issue and evidence of the lack of anticompetitive effects of conduct at issue was properly excluded from trial; the presence of procompetitive justifications is inadmissible for the purpose of proving that the price fixing or bid rigging conspiracy was reasonable in a per se Sherman Act case. Testimony from the co-conspirators was credible and to the extent there were competing inferences to be made from the testimony, that was for the jury to decide.

This case is No. 1:18-cr-00333-JGK.

Attorneys: Kevin Bradford Hart, Department of Justice Antitrust Division, for the United States. Martin B. Klotz (Willkie Farr & Gallagher LLP) for Akshay Aiyer.

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