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Silver Dragon Resources Inc. Message Board

  • kodyscorner May 10, 2010 1:57 PM Flag

    Feds probing JPMorgan trades in silver pit

    Federal agents have launched parallel criminal and civil probes of JPMorgan Chase and its trading activity in the precious metals market, The Post has learned.

    The probes are centering on whether or not JPMorgan, a top derivatives holder in precious metals, acted improperly to depress the price of silver, sources said.

    The Commodities Futures Trade Commission is looking into civil charges, and the Department of Justice's Antitrust Division is handling the criminal probe, according to sources, who did not wish to be identified due to the sensitive nature of the information.

    The probes are far-ranging, with federal officials looking into JPMorgan's precious metals trades on the London Bullion Market Association's (LBMA) exchange, which is a physical delivery market, and the New York Mercantile Exchange (Nymex) for future paper derivative trades.

    JPMorgan increased its silver derivative holdings by $6.76 billion, or about 220 million ounces, during the last three months of 2009, according to the Office of Comptroller of the Currency.

    Regulators are pulling trading tickets on JPMorgan's precious metals moves on all the exchanges as part of the probe, sources tell The Post.

    JPMorgan has not been charged with any wrongdoing.

    The DOJ and CFTC each declined to comment, as did JPMorgan.

    The investigations stem from a story in The Post, which reported on a whistleblower questioning JPMorgan's involvement in suppressing the price of silver by "shorting" the precious metal around the release of news announcements that should have sent the price upwards.

    It is alleged that in shorting silver, JPMorgan sells large blocks of silver option contracts or physical metal -- actions that would bring down the price of the metal -- closely following news that would otherwise move the metals higher.

    Last week, The Post got a telling e-mail the Justice Dept. sent to a concerned investor. "Thank you for your e-mail regarding allegations that JPMorgan Chase, and perhaps other traders, are manipulating the silver futures market," the e-mail read.

    Telling, indeed, as the concerned investor, in an e-mail to Justice's Anti-trust division, never mentioned any companies or traders.

    Read more:

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    • Robert Fung just completed a nice deal for KRY, Crystallex. apparently the chinese are acceptable business partners while the canadians / us are not.

      this credibility reinstating development for Fung will eventually rub off on SDRG as Fung is leading SDRG's strategy to maximize it's opportunity.

    • Wall Street OWNS THE SEC and ALL OF THE REGULATORY AGENCIES. What you are reading is the making of a Maddoff type coverup.

      • 1 Reply to meijergoldstein
      • Hate to say it ... but I agree with you.

        Seems more likely that the JP Morgan story was released to suck in traders to the long side - thinking that JP's shenanigans might be coming to an end.

        Only to have prices manipulated lower worse than ever before.

        Can you say Ching Ching ?

        Besides, this action in the Dragon isn't scaring me one bit. Having traded futures and stocks for over 30 years - this is typical wash-out action which typically occurs before the major move higher.

        Metals action is clearly all tied to Futures Options expiration on Tuesday ... Metals and the Dragon will likely be substantially be the end of next week.

        Anyone out there the proud owner of the 2000 share stop order that got triggered at 16 cents at the open ? Some people never learn ....