Market Manipulation Charges: Acquittal Through Reanalysis of Trading Data
We proved that, by changing the premise of the prosecution's analysis, the same order records could be explained as normal trading.
Basic Facts
The client was indicted on charges of artificially inflating the share price of a specific stock.
The prosecution argued, based on the order patterns in the account, that matched orders and high-price buy orders had been repeated.
The period under analysis was approximately six months.
Jeongpyeong's Assistance
We obtained the raw data again and re-aggregated it by order unit, checking what assumptions the prosecution's analysis rested on.
By comparing overall market fluctuations and trends in comparable stocks during the same period, we contextualized the proportion of the orders at issue.
Based on order book depth and execution timing, we demonstrated that most of the flagged orders could be explained as an ordinary staggered buying strategy.
We obtained an expert opinion from a financial engineering specialist and explained the limitations of the analytical methodology in court.
Result
The court rendered a verdict of not guilty.
This was a case in which challenging the very framework used to interpret the numbers changed the outcome.
Facing a similar situation? We'll help you sort out the facts first.