July 8, 2025
The Upper Tribunal has handed down its judgment in Lopez Gonzalez and Ors v The Financial Conduct Authority [2025] UKUT 00214 (TCC), upholding the FCA’s decision to ban and fine three ex-City traders for market abuse.
The case involved a practice known as “spoofing”. The Upper Tribunal found that during the period 1 June 2016 to 29 July 2016, Diego Urra, Jorge Lopez Gonzalez and Poojan Sheth, all previously traders at Mizuho International Plc, had engaged in a dishonest and abusive scheme when trading in Italian Government Bond futures (BTP futures). The abusive strategy involved the traders placing genuine orders of BTP futures on one side of the market and then placing larger orders, that they did not intend to execute, on the opposite side of the market in the hope that it would help their small orders to trade. Once the small orders had traded, the traders would cancel the large orders without executing them. The FCA’s case was that the traders had between them engaged in this practice on 233 occasions over the course of the two-month period.
The FCA proposed to ban the traders from future regulated activities pursuant to s. 56 of FSMA 2000, and fining each of them pursuant to s. 123(1) of FSMA 2000. The Upper Tribunal unanimously dismissed the traders’ challenges, upholding the ban and imposing substantial penalties (slightly reducing two of them to account for the timing of bonuses and, in one case, the trader’s comparatively lower salary).
“Spoofing” cases are rare in the UK as compared with the US, and can be challenging to prove, since a lack of intention to trade can frequently only be inferred from the trading activity itself. Such cases may, however, become more prevalent going forward. In March 2025, the FCA launched a new 5 year strategy which reiterated its commitment to tackling market abuse; and in April 2025 the Joint Executive Director of Enforcement and Market Oversight for the FCA delivered a speech addressing the FCA’s strategy for tackling market abuse which made specific reference to this case as an example of its work to protect the markets. This case is therefore likely to form an important precedent on market abuse.
Sharif Shivji KC, Lara Hassell-Hart and Nicholas Wright appeared for the Financial Conduct Authority.
The full judgment is here.
The FCA’s press release is here.
