By Peter Hobson, Lawrence Delevingne and Koh Gui Qing
LONDON/NEW YORK (Reuters) – Two JPMorgan Chase & Co <JPM.N> employees, including a top metals trading executive, have been placed on leave in response to a U.S. criminal investigation into the bank’s metals trading practices, according to a source familiar with the matter.
Michael Nowak and Gregg Smith are on leave, the source said on Thursday. Nowak is a managing director and global head of base and precious metals trading in New York for the bank, according to his LinkedIn profile. Smith’s title could not be learned. Nowak was placed on leave around late August, the source said. Neither Nowak nor Smith have been charged with a crime.
Attorneys for Nowak did not respond to a request for comment. A call to Smith’s number at the bank was answered by an employee at the metals desk who directed questions to the bank’s public relations department. Reuters could not learn the identity of his lawyer.
A spokesman for the Department of Justice declined to comment. JPMorgan said in an August 2019 regulatory filing that it is “responding to and cooperating with” investigations by various authorities, including the Department of Justice, relating to trading practices in the metals markets.
In August, a JPMorgan metals trader pled guilty to charges of spoofing between 2007 and 2016, after another JPMorgan metals trader had pled guilty to spoofing in October last year.
Spoofing involves placing bids to buy or offers to sell contracts with the intent to cancel them before execution. By creating an illusion of demand, spoofers can influence prices to benefit their market positions.
(Reporting by Peter Hobson in LONDON, Lawrence Delevingne and Koh Gui Qing in NEWYORK; editing by Edward Tobin)