The British financial trader accused of manipulating the US stock markets on the day of an $800bn (£565bn) “flash crash” faces extradition within 28 days after being denied permission to appeal against the order.
Navinder Singh Sarao, 37, nicknamed the Hound of Hounslow, must now be sent to America and surrendered to the US authorities.
After a two-and-a-half-hour hearing at the court of appeal in London on Friday, Lord Justice Gross and Justice Nicol denied a renewed application to appeal against extradition. Their reasons are to be given at a later date.
The counsel for the US acknowledged there was no longer a suggestion that Sarao had played a significant role in provoking the flash crash.
During the 36-minute crash, on 6 May 2010, the Dow Jones industrial average plummeted by 998.5 points – its biggest slump during a single trading session.
“This is a case about the ‘spoofing’ of the US market over five years,” counsel for the US told the high court. Spoofing is the placing of an electronic order on an exchange with the intent of giving others a false impression of market demand.
After the price reacted to that alleged deception, Sarao, who traded from his parents’ home in west London, is alleged to have bought or sold stock knowing he could cancel the spoof order. He is accused of making $40m from spoofing between 2009 and 2014.
Revising allegations concerning links to the flash crash, counsel for the US said: “This case is connected to the flash crash in that he was trading on the day in question.” It is accepted, however, that he had ceased trading minutes before the crash.
All legal options for Sarao in the UK have been exhausted and he must stand trial in the US on 22 counts of wire fraud, commodities fraud and market manipulation carrying a maximum combined sentence of 380 years’ imprisonment.
The initial extradition ruling was made by the district judge Quentin Purdy at an extradition hearing at Westminster magistrates court in March.