U.S. Charges Canadian Man For ‘Layering’

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U.S. Charges Canadian Man For ‘Layering’

Federal criminal prosecutors in New Jersey have charged Aleksandr Milrud of Ontario, Canada with one count of wire fraud and one count of conspiracy to commit securities fraud. Milrud was arrested at a house he owns outside of Miami, Florida. The SEC has also filed a civil case against him.

Milrud is believed to have manipulated stock prices through a process known as ‘layering,’ which involves making false orders to create the illusion of increased activity in a stock or other asset in order to change its price. This marks the first case of its kind to be brought against a trader in the stock market.

Both the SEC and the federal prosecutors believe that Milrud utilized a network of foreign traders and brokerage account to place false orders for individual stocks to move their prices in a specific direction. Those orders would be canceled before they could be filled, but traders under Milrud would also make actual trades in the stocks in order to take advantage of their temporarily inflated or depressed prices.

According to prosecutors, Milrud hired a software company to program “hotkeys” so orders could be made and canceled using just a few keyboard strokes. Milrud allegedly believed his fake orders would be untraceable, but U.S. authorities convinced the owner of an offshore broker-dealer he was using to cooperate with their investigation. Prosecutors said Milrud explained his scheme in detail to the cooperator.

If you or someone you know has lost money as a result of an investment or Ponzi scheme, please contact Richard Frankowski at 888-741-7503 to discuss your potential legal remedies or complete the contact form.

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