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Press Release

Former Bank Employee Pleads Guilty to Manipulating U.S. Treasury Securities Prices

For Immediate Release
Office of Public Affairs

A former trader at a global financial institution pleaded guilty yesterday to manipulating U.S. Treasury securities prices.

According to court documents, Tyler Forbes, 27, of Manlius, New York, was employed as a trader on the U.S. Treasuries desk of a global financial institution. From approximately January to June 2019, Forbes engaged in an unlawful “spoofing” scheme to manipulate the price of certain U.S. Treasury securities traded in the secondary (or “cash”) market — predominantly two and three-year U.S. Treasury notes, as well as 10-year U.S. Treasury notes. Forbes’s spoofing strategy involved electronically placing large, non-bona fide “spoof orders” that he intended to cancel prior to execution on one side of the market, while simultaneously entering smaller, genuine orders that he intended to execute on the opposite side of the market. Many of Forbes’s genuine orders were “iceberg” orders, meaning that only a portion of the order’s full size was visible to other market participants at any given time, whereas all of Forbes’s spoof orders were fully displayed. The purpose of Forbes’s “spoof orders” was to create a false appearance of market depth and activity in order to mislead other traders, and to artificially raise or depress the prevailing market price so that Forbes could execute his genuine orders more easily or more profitably. 

Forbes pleaded guilty to one count of manipulation of security prices. He is scheduled to be sentenced on July 28 in the Eastern District of New York and faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division and Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division made the announcement.

The FBI investigated the case.

Deputy Chief Avi Perry and Trial Attorney Sara Hallmark of the Criminal Division’s Fraud Section are prosecuting the case.

Updated April 15, 2022

Financial Fraud
Securities, Commodities, & Investment Fraud
Press Release Number: 22-390