The Commodity Futures Trading Commission has brought to a close its civil enforcement action against former JPMorgan precious-metals traders Michael Nowak and Gregg Smith, ending one of the longest-running spoofing cases tied to Wall Street's metals desks.

On December 22, 2025, U.S. District Judge Franklin U. Valderrama of the Northern District of Illinois entered consent judgments resolving the regulator's claims, more than six years after the lawsuit was first filed. The settlements fully conclude the CFTC's civil action against both defendants.

Under the terms of the judgment, Smith agreed to pay a $200,000 civil monetary penalty. He is permanently restrained from engaging in spoofing or any conduct barred under Section 4c(a)(5)(C) of the Commodity Exchange Act, which prohibits bidding or offering with the intent to cancel before execution. Smith is also barred for three years from trading on or subject to the rules of any registered entity, trading commodity interests for his own or others' accounts, directing trading activity, soliciting funds, or seeking registration with the CFTC.

Nowak, who previously served as JPMorgan's global head of precious-metals trading, agreed to pay a $150,000 civil penalty. He is subject to a permanent injunction against spoofing and faces a six-month ban on trading commodity interests, directing trading activity, soliciting funds, or engaging in any activity requiring CFTC registration.

As part of the resolution, the parties agreed to dismiss Counts II and III of the complaint with prejudice, bringing the civil case to a formal close.

Investor Takeaway
The penalties are modest, but the permanent injunctions and trading bans effectively remove both traders from regulated derivatives markets.
What Was the CFTC Alleging in the Metals Spoofing Case?
The CFTC first filed its lawsuit in September 2019, alleging that Nowak and Smith engaged in a years-long scheme to manipulate precious-metals futures prices while employed at JPMorgan. The alleged misconduct spanned at least 2008 through 2015 and involved trading on futures exchanges operated by CME Group.

According to the complaint, the traders placed thousands of large orders in gold, silver, platinum, and palladium futures with the intent to cancel them before execution. Regulators said the orders were designed to create false signals of supply and demand, prompting other market participants to trade at prices that benefited the defendants' genuine orders on the opposite side of the market.