CHICAGO (Reuters) - Futures brokerage R.J. O'Brien cleared trades recently for a British man accused of market manipulation that authorities say contributed to the May 2010 Wall Street "flash crash," a company spokeswoman said on Thursday.
R.J. O'Brien "had no involvement in the trading decisions" of the futures trader in question, Navinder Singh Sarao, or his company, she said. The firm cooperated with authorities in their investigation into Sarao, the spokeswoman added.
Sarao, 36, is accused by U.S. authorities of using an automated program to "spoof" markets by generating large sell orders that pushed down prices. He then canceled those trades and bought the contracts at the lower prices, reaping a roughly $40 million profit on his trading, authorities have said.
The flash crash on May 6, 2010 saw the Dow Jones Industrial Average briefly slide over 1,000 points, temporarily wiping out nearly $1 trillion in market value.
In a complaint, the U.S. Department of Justice said Sarao's activities "contributed to the order book imbalance" that was a factor in the plunge.
(Reporting by Tom Polansek; editing by David Gregorio and G Crosse)
