r/interesting • • 9d ago

Just Wow Bro cashed out way too much

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A man working from his parents' house in West London made tens of millions of dollars trading futures from a bedroom filled with stuffed toys. His name is Navinder Singh Sarao, and he's on the autism spectrum.

There was no Wall Street trading floor. Sarao worked out of the family home in Hounslow, using a customized trading program on an ordinary desktop computer, and by most accounts he lived a pretty quiet life.

Then came May 6, 2010. In a matter of minutes, US stock markets plunged, and nearly $1 trillion in value briefly vanished before prices bounced back. It became known as the Flash Crash.

Years later, US authorities said Sarao's spoofing helped make it worse. Prosecutors said he placed large sell orders he never intended to fill, then canceled them, which pushed prices down so he could profit from the swings. They said his strategy was running on the day of the crash, and that he made more than $40 million from this kind of trading over several years.

Sarao fought extradition from the UK for years. He eventually pleaded guilty to wire fraud and spoofing in the US. His lawyers pointed to his autism, and the judge sentenced him to time served followed by home confinement rather than more prison time, citing his cooperation with prosecutors.

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36

u/InsectaProtecta 9d ago

He got in trouble for stock market manipulation. This is the second post I've seen today where people fundamentally misunderstand the difference between getting rich and committing an obvious crime.

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u/SilverHeart4053 9d ago

Robin Hood didn't get in trouble for stock market manipulation when they LITERALLY DISABLED THE BUY BUTTON ON GME

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u/EmuAppropriate1275 9d ago

Absolutely disgusting they got away with that crap.

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u/Gizogin 9d ago

Because you could still buy that stock through other means? RobinHood just wouldn't let you borrow their money to do it anymore, because they ran out.

And yes, that was RobinHood's business model. That's what "instant deposit" was: you put money into your account, but it takes three or four business days to actually go through. RobinHood lets you borrow their money in the meantime to make your purchases faster, then they reimburse themselves when your deposit actually lands. But there was such a frenzy around GME (from brand-new accounts with no actual deposits processed yet) that RobinHood was at risk of running out of money.

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u/Brewermcbrewface 7d ago

Anything running through the Apex clearing house had its buy button disabled. The fishy part was the DTCC threw them a life line and they didn’t have to make PCO GME

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u/green_apple_trees 9d ago

Then the solution is to suspend temporarily the “instant deposit” model and tell platform users they have to wait 3 days for funds to clear before buying any stock. Removing the buy button on a stock is shady as fuck and just plain market manipulation.

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u/Gizogin 9d ago

I wouldn't be surprised if that was just not possible with their backend, at least not fast enough to make a difference. Saying "you can't buy this stock right now" is almost certainly an easier "panic button" to push - and less disruptive to the majority of their users, most of whom were not buying GME in a frenzy - than changing their entire payment processing system for everyone.

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u/green_apple_trees 8d ago edited 8d ago

If it wasn’t possible with their backend then it meant their IT was dogshit and they should have invested more in having a robust and flexible IT system from the start instead of being Scrooge McDuck. Also they should have capitalised themselves way better from the start. If you want to provide short term stock loans with instant access to people then you better be extremely well capitalised. They were running their balance sheet undercapitalised from the start.

Stop simping for low IQ management. They did huge reputational damage to themselves which took them years to recover from.

I hate how in the modern world everyone loves to hold individuals to a high level of accountability but nobody wants to hold corporations or governments to the same level of accountability.

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u/Huppelkutje 8d ago edited 8d ago

Robin Hood being a shit company is not market manipulation.

Explaining why Robin Hood had to shut down is not "simping for low IQ management".

Do you know why all the GME bagholders used Robinhood Hood? 

It's because with more legitimate brokerages, the ones that had zero issues trading GME during this shit storm, you need to wait for your deposit to clear before you can buy stock.

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u/SilverHeart4053 8d ago

Fucking scabs out here defending companies like Robinhood be doing too much

0

u/Bluehorsesho3 8d ago

Wasn’t just Robinhood, same thing happened on E*trade and Charles Schwab, that whole week radicalized me pretty much for life. Those brokerages aren’t a free market, they are digital gatekeepers.

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u/Gizogin 8d ago

But, like, RobinHood and the other app-based brokers weren’t the only ways to trade stocks. They switched off the buy button on Jan 28. That day, GME closed at just under $200. The next two business days, it closed at a higher price; around $325 on Jan 29, and around $220 on Feb 1. So those app-based brokers didn’t kill the “squeeze” at all.

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u/Bluehorsesho3 8d ago

It squeezed in the pre-market to $500 because there are no halts pre market open. If you think taking away the buy button doesn’t cause a wave of selling, you’re either a bad faith actor or just oblivious.

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u/DblockR 6d ago

I’m just reading and trying to educate myself on this. Can you elaborate and maybe dumb this down for me plz?

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u/LackWooden392 6d ago

Translation:

The value of the stock reached $500 in premarket trading, which only some platforms give you access to, and has lower volume, but occurs before 9 am, as a result of the ongoing short squeeze, because the buy button had not yet been disabled.

If you think disabling the buy button didn't result in an artificially inflated net supply of stock available to buy, and thus apply a downward pressure on the stock's price, you're either a bad faith actor or just oblivious.

He's saying that Robinhood disabling the buy button severely mitigated the short squeeze, and saved hedge fund's necks by letting them close their shorts at $200 instead of $500.

And he's right.

Hope that helps!

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u/North_Affect_8167 9d ago

It's an obvious crime only when you are regular dude living with your parents and not a billionaire with connection with the president.

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u/ippleing 9d ago

Stocks are manipulated on a daily basis.

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u/unclefire 9d ago

It was only a crime b/c the made money at the expenses of the MM and HFTs

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u/Unambiguous-Doughnut 9d ago

To be fair if your big enough or in a form stock market manipulation is perfectly legal because the system is broken.

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u/S1ckn4sty44 9d ago

I mean, shit, look at the market manipulation by the president every fucking day.

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u/VitaminPb 9d ago

Elon Musk had entered the chat.

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u/ippleing 9d ago

'Funding secured'

That alone ripped the stock on a double digit increase in minutes.

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u/crunkful06 9d ago edited 9d ago

It’s only a crime if the rich don’t benefit. Fuck all of them

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u/drewster23 9d ago

Rich people go to jail for market manipulation/fraud etc all the time.

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u/Dependent_Rock_4739 9d ago

Those barclays bank managers have literally just had their convictions overturned for doing exactly this. It hit the news for all of about 30 minutes and now they get to go on with their lives

-6

u/drewster23 9d ago

Wow some bank managers just got off...that means no one has ever gone to jail for it right?

Fucking redditor logic.

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u/green_apple_trees 8d ago

It happens once in a blue moon but it is exceedingly rare especially when compared to the number of people actually committing these crimes.

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u/Optimal-Cup-257 9d ago

I actually want to take this bait.

Can you provide details on these numerous arrests?

I want to specify, I mean the actual people in power. Not the wrist slaps and punishments for those who angered those in power.

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u/CalebOg 8d ago

Home confinement seems like a slap on the wrist for 1 trillion?

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u/Iankill 9d ago

It's not all the time and the sentences are usually weak.

They steal 10 million get 2 years

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u/Sochi540 9d ago

Tell me how he manipulated the stock market again, im kinda out of the loop

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u/wmurray003 9d ago

"Prosecutors said he placed large sell orders he never intended to fill, then canceled them, which pushed prices down so he could profit from the swings. They said his strategy was running on the day of the crash, and that he made more than $40 million from this kind of trading over several years."

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u/Sochi540 9d ago

Several years of work but they choose that day of all days, its almost beautiful.

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u/wmurray003 9d ago

It was a notable day. He was under the radar up until that point.

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u/Sochi540 9d ago

Yeahh, my main wonder is what tech he was using. It's kinda strange that they never brought it up. People are getting mad at him for using a tool so simple that it's years in the making. Are you mad at a game guy for using scripts, it's basically this but on a national level.

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u/wmurray003 9d ago

"...using a customized trading program on an ordinary desktop computer" ...I don't think it was so much the level of technology as it was HOW he was using the program

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u/Sochi540 9d ago

Dude..... he wasn't even using hardware...... nvm I need to stop following this story. These are common ass tactics for dudes in their 60s with nothing to lose.

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u/devAcc123 9d ago

Iirc he just spoofed a huge number of sell orders and for whatever reason this day in particular triggered a bunch of actual selling from the big boys in a sort of death spiral

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u/Sochi540 9d ago

Honesty one thing I gleamed from the evidence is that he is using old ass ancient tech. Or when he upgrade to his new whip they finally got him, who knows.

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u/Brewermcbrewface 7d ago

Kinda like how places route sell orders first then fill the buy orders in the dark pools to manipulate the prices

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u/InsectaProtecta 9d ago

It says it right there in the post. He was placing large sell orders he never intended to fulfill in order to drop stock prices so he could buy on the downswing and profit. That's illegal regardless of how much money you have

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u/Renew3DUK 9d ago

So basically, presidential trading.

Didn't pay his truth social fees.

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u/ilyedm 9d ago

My mind is blown right now. The post is just a couple paragraphs. Yet so many people are commenting confidently without having read it at all. 

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u/Sochi540 9d ago

So he got arrested for using common shorting techs?

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u/drewster23 9d ago

Market manipulation is illegal.

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u/Sochi540 9d ago

Dude. If placing orders is market manipulation then wait until you hear about what companies are doing

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u/InsectaProtecta 9d ago

Placing orders is not market manipulation. Making lots of high volume orders without any intention to fulfill them to manipulate the stock market is

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u/Significant-Row2457 9d ago

Lol wow you’re going to hard to defend the elites 

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u/Remarkable_Print9316 9d ago

Yeah, no, he made $40 million by placing fraudulent orders. Real common man. You're so mad at money it's making you dumb.

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u/Comfortable_Sir_6104 9d ago

If you are completely clueless about a topic you can just not speak. People got way too comfortable with speaking whatever idiotic shit comes to their minds with zero understanding of the topic.

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u/wmurray003 9d ago

"...placed large sell orders he never intended to fill, then canceled them..."

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u/Sochi540 9d ago

No wonder the judges let him off easy, he was frigging just ordering shit, like calling 50 pizzas to a guy's house.

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u/Remarkable_Print9316 9d ago

And then not paying for it, which if you do it to a varying threshold by state but about $1000 - some really nice pizzas, becomes felony level theft of services.

He wasn't punished because of both an extreme self-harm risk under jail conditions, and an impediment recognized as diminishing your ability to even understand the rules.

Do you have such an impediment?

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u/Sochi540 9d ago

Crime for harassment of business in my area js a 10k fine or jail time. I have 400k bank.

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u/Sugarfoot2182 9d ago

55 pizzas and 55 fries; not to mention the 55 DC’s to wash it all down.

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u/Sochi540 9d ago

I'll get my grandma to order a salad too.

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u/drewster23 9d ago

No clue wtf you're on about but you evidently have 0 understanding of what he did

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u/Sugarfoot2182 9d ago

He’s doing a thing

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u/Sochi540 9d ago

K, then I won be explaining.

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u/drewster23 9d ago

No it's not just "placing orders"

I think you're just here to make comments in bad faith. Because that was the most simpleton reductionary take possible.

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u/97SerranoPeppers 9d ago

I wouldn’t give him that much faith. There are a surprising number of people who don’t have great comprehension skills. He’s probably read it several times but hasn’t been able to fully process the information.

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u/LumpyBuy8447 9d ago

The last 6 months have proven it isn’t, at least for a certain demographic

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u/tempacc2026 8d ago

It is 100% illegal. If the system has been captured by your cronies, it doesn’t make it legal. It just means you won’t get prosecuted.

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u/Ryan_e3p 9d ago

There's a lot of people in the White House and Congress you should probably tell.

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u/drewster23 9d ago

Fucking kids is illegal too hasn't stopped them.

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u/Mount_Treverest 9d ago

Depending on who does it. When someone like Musk does it its fine.

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u/YT-Deliveries 8d ago

It's only illegal for poor people. At least be honest.

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u/InsectaProtecta 9d ago

No, he was arrested for spoofing. If he'd actually fulfilled the orders or even intended to it would be a different story. He was using a program to make and cancel orders without any intention of ever fulfilling them in order to manipulate stock prices.

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u/Business_Raisin_541 9d ago

how can he cancel? why can't the bank force him to fulfill the order?

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u/throw2503 9d ago

I don't even know where to start explaining if this is your level of understanding. He wasn't trading against banks, he was trading against other players like him and big institutions in the futures market.

When you place a limit order as opposed to a market order, you can cancel the order before a buyer/seller in the same market takes your order. Nobody can force a limit order to be fulfilled

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u/Business_Raisin_541 9d ago

So why is that illegal while Elon Musk keep on overpromising like dominating in EV, optimus robot that is going to dominate robot market, spacex that is going to have revenue as much as current USA GDP in several years? Why is that not illlegal? And why are all the banks that support Elon Musk ridiculous also not illegal?

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u/tempacc2026 8d ago

I pity the parent commenter for trying to talk to you. He wasted more than 2 minutes of his day (now as have I) when you don’t deserve that much time even in seconds.

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u/Sochi540 9d ago

Again common shorting tech.

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u/InsectaProtecta 9d ago

Absolutely not

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u/Sochi540 9d ago

If you don't think big companies use the same tech he used on rival companies then ur brainwashed, they are just better at paying off the judge

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u/North_Affect_8167 9d ago

Bloomberg terminal, Truth Social early access.

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u/Significant-Row2457 9d ago

So he was arrested because he wasn’t a rich guy using their tactics? That’s literally what you’re saying 

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u/Comfortable_Sir_6104 9d ago

It is really not that hard to Google shit you are clueless about.

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u/Significant-Row2457 9d ago

And it’s not hard to stop defending your corporate overlords 

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u/drewster23 9d ago

Except no one is doing that. Telling you the facts isn't simping for big trading.

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u/kirkby100 9d ago

You are making lefties sound as clueless as magas...

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u/Significant-Row2457 9d ago

Lol whatever you say dude, just because we can see reality and you can’t? Lol ok

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u/InsectaProtecta 9d ago

That's not literally what I'm saying, nor is it true.

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u/Sochi540 9d ago

Instead of fines, and misdemeanors, he's getting real jail time for using common methods that high office traders use wtf.

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u/InsectaProtecta 9d ago

Name one

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u/Sochi540 9d ago

Low inventory, ddos, buying ips and trashing them, etc. But this isn't market manipulation its standard business practice

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u/InsectaProtecta 9d ago

Name a high volume trader that is spoofing

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u/Sochi540 9d ago

Pfff, duh, you don't use this tech alone idiot that was his mistake.

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u/ippleing 9d ago

'Funding Secured'

Elon Musk in reference to having Tesla bought out.

Years of back and forth and nothing happened.

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u/InsectaProtecta 9d ago

Not the same thing at all but also he got a 20m fine and is no longer chairman of Tesla.

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u/SaraaWolfArt 8d ago

No, this is not what happened. He was not in trouble for short selling

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u/Sochi540 8d ago

I can't believe, im saying this, but I'm tired of people harassing me. When people try to short a stock, they tend to do it in groups or try to buy as much of the stock on the market before shorting

1

u/SaraaWolfArt 8d ago

Right? But he didn't do a bear raid he did fraud.

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u/Comfortable_Sir_6104 9d ago

You are exactly what is wrong with society right now. You can educate yourself instead of speaking whatever nonsense comes to your mind at the moment. You can actually check your information, learn something for once in your life instead of bullshitting about a topic you clearly know absolutely nothing about. 

But no, you just need to speak confidently when you have zero knowledge, you just need to spread misinformation that other gullible people will choke on.

1

u/Plastic_Listen_7711 9d ago

tl;dr buddy is an average redditor

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u/NotInTheKnee 8d ago

This year has been rife with stories about politicians trading large amount of stock just hours before official announcements caused major market shift.

Coincidentally, the same politicians are reported to now be millions, if not billions richer than before the start of their terms.

It's 100% a 2-tiered justice system.

1

u/MightB2rue 8d ago

What does that have to do with manipulating stock prices by pretending to have a large sell order which scares the market participants making the share price drop so that he could buy it cheap. Then when he took out the pretend sell order, the price went back to where it was before and he profited. Clear market manipulation.

What does that have to do with potential insider trading by politicians?

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u/Comfortable_Sir_6104 8d ago

That is a completely different thing. I know the system is corrupt, I am only saying they are not cheating in that one particular way.

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u/PB219 8d ago

Those politicians might not be. Large financial institutions 100% spoof orders all the time.

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u/GrimbyJ 4d ago

He set up a contingency plan in case he got caught. He knew that what he was doing was explicitly illegal.

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u/Sochi540 4d ago

Bruv it's been a week, go outside

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u/GrimbyJ 4d ago

I went outside yesterday. I don't need to again for a couple more days

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u/Sochi540 4d ago

The defendant can go outside whenever he wants btw, after doing his time and even being in the loop so he doesn't get behind on the times, way better than hard time in jail.

0

u/Low-Car-6331 9d ago

No, shorting is when you sell stocks you don't own yet, meaning you fulfilled the order. If he fulfilled the orders he placed he would be legally in the clear, but because he put in the orders with no intent to fulfill them it became illegal. Imagine if a place puts up a sign saying "Gas $0.01 a Gallon!!!!!" so people go out there and "Yeah we have no gas suckers! lolololol" the local prosecutors could have you criminally charged for that.

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u/Sochi540 9d ago

Sigh. Another genius in the room

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u/Low-Car-6331 9d ago

Buddy if you don't understand stock trading that isn't my problem, and you insulting me like that doesn't change anything. So, sorry for trying to explain something to you, clearly though you have no intent to learn and want to continue to live your sad excuse of a life.

1

u/RockosModernBasiIisk 9d ago

That actually works?

1

u/sixpackabs592 9d ago

Bruh the ops post has it all right there

2

u/Business_Raisin_541 9d ago

bro, those wall street firms do market manipulation all the time.

1

u/Jonesbro 9d ago

And literal wire fraud

1

u/Lephas 8d ago

he can do it in crypto now. nobody will care. every day is see blatant market manipulation

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u/Sennten 8d ago

Im not sure if you noticed, but stock market manipulation is very much de facto legal nowadays as a general rule. It makes sense why people would fail to understand the difference when its not an obvious crime when done by the people they are familiar with.

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u/[deleted] 8d ago

[deleted]

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u/leo_sk5 8d ago

How about declaring war on iran seconds after buying stocks related to oil etc, and then selling them just before making peace with Iran?

1

u/Bbarakti 8d ago

I was about to start digging through the long list of the present administration's stock market manipulation... I'm wondering if the stock bro you're arguing with is a magat. Because saying Wall Street doesn't consistently do everything it can to cheat and defraud the average Joe is disingenuous or ignorant.

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u/taklabas 8d ago

The average Joe's money is the biggest majority stake on Wall Street. If Wall Street is manipulating to make money, it's making more money for average Joe.

1

u/Sennten 8d ago

... where do you think the money people make in wall street comes from? You want the pool of marks to be bigger than the pool of takers, thats the whole fucking point of speculative systems.

1

u/taklabas 8d ago

So the people making money off of commissikns are doing what? Committing fraud and intentionally making bad investments, for what?

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u/Due-Description-1299 8d ago edited 8d ago

I can't make you believe me but I'm the exact opposite. We have a legal code and people at the SEC and CFTC who have put teeth against big corporations for manipulating the stock market many times in the past and it makes me roll my eyes when people say it can't be done. I'm not arguing there is no corruption, I'm saying rules exist that HAVE been used to hand down fines/sentences in the past. They could be enforced better or improved, especially against crypto markets for example.

Edit: also let me point out that we were talking about spoofing and high frequency trading in 2010 and when I mentioned Bernie Madoff dying in prison for market manipulation and like four other companies hit with massive fines been 2010-2015, people wanted to make the point that we're slacking in 2026, and I think both things are true. I was tired and levied some irrelevant points while thinking about other comments in the thread and should have left this alone at first.

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u/Bbarakti 8d ago

I appreciate that. I actually do believe you. I just think that the overall direction the country has gone in over the last few decades is to not hold these people to account. But I acknowledge that there have been several high-profile cases where the government has done its job and enforced our laws.

Not lately though, and the present administration has done everything it can to defang any of those agencies that might be able to hold these white-collar criminals to account.

But I actually don't disagree with you, and it warms my heart when they try to enforce the law on these types of criminals, even if it's not as vigorously as they enforce cannabis laws or other low-level street criminal laws.

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u/PB219 8d ago

lol order spoofing is something large institutions do all the time.

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u/Advanced_Algae_5476 3d ago

The irony. His spoofing was exactly the same as the market makers he was exploiting. How can you call one fraud and not the other.

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u/PeachScary413 9d ago

Oh right.. manipulation as in doing pretty much exactly what every HFT firm is doing and has been doing forever? Bro gtfo he got scapegoated for something he didn't even do.

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u/Ok-Budget3225 9d ago

What crime did he commit? You are allowed to cancel orders that haven’t executed yet 

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u/InsectaProtecta 9d ago

You are not allowed to rapidly make large volume orders you never have any intention of fulfilling in order to manipulate stock prices

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u/mahlernameless 9d ago

If you're rich they let you do it.

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u/InsectaProtecta 9d ago

Except those times they went to prison

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u/KeyMyBike 9d ago

History books are full of things that never happen anymore, aren't they?

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u/Live_Collection_9717 8d ago

they let you grab them - DJT

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u/EducationTight4402 9d ago

HAS ANYONE TOLD WALL STREET THIS NEWS

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u/RecoverLive149 9d ago

How can they know his intention?

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u/superbatprime 8d ago

They knew he intended to commit this crime because he had a program designed to commit this crime and was using it to commit this crime.

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u/lifeisalime11 9d ago

This is like counting cards in a casino…. cmon now

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u/SuperSiriusBlack 8d ago

It's like writing a program to count the cards for you, then order them in a way to deal you 21 every hand, but okay.

1

u/YungRik666 8d ago

That's also a dumb law. If they don't want to lose money at blackjack don't offer it at the casino. If the game can be cracked with math and a little patience then its a bad game to offer. Especially if the business is built on people losing

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u/stormcharger 8d ago

It's not against the law, the casinos however are a private business and can trespass you for any reason, including counting cards

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u/Formal_Evidence_4094 8d ago

that means it was a terrible comparison to start with , because market manipulation is an actual crime

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u/RecoverLive149 8d ago

Market manipulation is only a crime if you are not well connected. ie. house always wins. When the house does not win, then its a crime

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u/Dennis_enzo 8d ago

Counting cards is not illegal.

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u/InsectaProtecta 9d ago

He set up an algorithm to do it automatically so they just looked at the logic it used.

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u/Soaptowelbrush 8d ago

Beyond having a written program for it that would show his intention I imagine if you place and then cancel a bunch of these orders and your reason isn’t any better than “because I felt like it” that’s probably gonna be treated as sus.

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u/RecoverLive149 8d ago

good point

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u/CevvalPortakal 9d ago

Can you explain more?

Shouldn't he have that much of stocks to give a sell order in the first place? Or vice versa, money to buy orders for this size of a manipulation?

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u/ExpressRabbit 8d ago

So there's no article for me to confirm but do we know it's stocks?

Futures trading to me sounds like commodities. So let's say he put a sell order for 50 million bushels of corn or a million heads of cattle. That drops the price of corn or cattle. He cancels the order then buys contacts to buy corn or cattle. When the price standardizes he sells that buy order to someone else before he needs to take delivery of the commodity. 

If you hang out on WallStreetBets long enough you'll see that every few months someone tries trading commodities futures, forgets about their order or doesn't sell since the price dropped, and all of a sudden they get an email asking for a lot of money and an address to deliver 50000 bushels of corn, 1000 barrels of sweet crude oil, or 100 heads of cattle and the dude is in a one bedroom apartment without the money, warehouse, refinery, or farm to pay for and take delivery of their purchase.

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u/ChargeInteresting278 8d ago

Oh you should watch a video on Jane Street's shenanigans in India. If you like this you'll love that shit.

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u/aNiceTribe 8d ago

Getting a delicious Chinese meal

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u/ForumVomitorium 8d ago

go order a fine hand crafted table and cancel when carpenter already started making it

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u/KalozKapitany 7d ago

And you put the macbook accidentally in your bag before paying for it.

0

u/terenul1 9d ago

Not thousands of them per second

1

u/Ill-Quantity2065 9d ago

Not that I don’t believe you, but what is the actual rule? 

It’s pretty obvious to prove his intent, but is there actually a rule saying you can’t place and cancel X number of trades in Y period of time