Spoofing Went Mainstream in 2015
- High-frequency bait-and-switch schemes take years to detect
- Tech available to regulators just now catching up to industry
How 'Spoofing' Might Have Crashed the Market
This article is for subscribers only.
Inside Ken Griffin’s $25 billion empire, Citadel LLC’s cyber investigators had isolated a new enemy: spoofers.
It was late 2013, and at the firm’s Chicago headquarters, a team of researchers discovered that a rival company’s algorithm was outmaneuvering their automated trader. The algo was placing futures orders it had no intention of filling to entice firms like Citadel into the transactions, then canceling them, leaving Citadel with money-losing trades. Citadel’s plan: to pit its computers against the spoofer in a high-stakes duel over market manipulation.