Trader can be extradited over Wall Street 'Flash Crash' claims
A British financial trader accused of helping trigger a multibillion-dollar Wall Street crash from a suburban home in west London can be extradited to the United States to stand trial, a judge has ruled.
Navinder Singh Sarao, 37, dubbed the Hound of Hounslow, is wanted in America over allegations he helped cause the 2010 Wall Street "Flash Crash" from his parent's home 3,500 miles away.
Sarao faces 22 charges including wire fraud, commodities fraud, market manipulation, and "spoofing" - a practice of bidding or offering with the intent to cancel the bid or offer before execution - which carry sentences totalling a maximum of 380 years.
The Flash Crash saw the Dow Jones Industrial Average plunge 600 points in five minutes on May 6, 2010, wiping tens of billions of pounds off the value of US shares.
American authorities claim the Briton, who was arrested in April, made 875,000 dollars that day, part of illegal earnings of more than 40 million dollars (£26 million) in five years.
District Judge Quentin Purdy on Wednesday rejected legal challenges by Sarao and his lawyers and said the Londoner could be sent to stand trial in the US in an extradition hearing at Westminster Magistrates' Court.
Following the court ruling, Home Secretary Theresa May has two months in which to either grant or reject the US extradition request. However, Sarao, of Clairvale Road, Hounslow, is unlikely to leave the UK in the near future.
His lawyers, who had argued his actions did not constitute a crime, said outside court that they planned to lodge an appeal once Mrs May makes her decision.
Lawyer Richard Egan said "We still think we have a strong argument and we will be appealing the decision (of the court) once the Secretary of State makes her decision.
"We are very disappointed. We think we had a strong argument but we will be going to the Court of Appeal to make our argument there."
US authorities needed to prove dual criminality - meaning that an alleged offence must be a crime in both countries - in order to extradite him.
At an earlier hearing his lawyers argued that his actions were not criminal in this country, while the Americans said they were covered by several British fraud offences.
A previous hearing heard that Mr Sarao allegedly manipulated the market by making "false" and "fictitious" orders on the Chicago Mercantile Exchange (CME).
But the former bank worker and Brunel University student's lawyers claimed that his orders "created true liquidity" and did not give a "false or misleading impression".
They also dismissed claims that he had a "meaningful, causal" link to the "Flash Crash" as "nonsense" and said he had stopped trading an hour before the market plunged.
In his written ruling, Judge Purdy said: "The causes of the Flash Crash are not a single action and cannot on any view be laid wholly or mostly at Navinder Sarao's door, although he was active on the day. In any event this is only a single trading day in over 400 relied upon by the prosecution."
But he added: "Essentially has the USA established that the same actions in this jurisdiction at the same time would be capable of being prosecuted for one or more offences known to the criminal law? This is not the forum for testing the evidence as in a trial. To my mind when all is said and done the USA are correct in arguing they have shown dual criminality."
He had earlier told Sarao in the packed courtroom that he could appeal, "otherwise the case will be sent to the US for trial".
Sarao, wearing a red jumper and black trousers, was released on bail after the short hearing. He declined to comment as he left the building.
At an early court appearance last May he said: "I haven't done anything wrong apart from being good at my job. How is this allowed to go on, man?"