'Flash crash' trader challenges bail conditions in high court

http://www.theguardian.com/business/2015/may/26/flash-crash-trader-challenges-bail-conditions-high-court-navinder-singh-sarao

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The British financial trader accused of contributing to a multibillion-dollar stock market crash in the US from his parents’ suburban London home is expected to make a fresh high court challenge against his bail conditions.

Navinder Singh Sarao, 36, is fighting extradition to the US on 22 counts of fraud and commodity manipulation and has been prevented from paying his £5m bail by a worldwide freezing order. He denies the charges against him and has requested he be freed from Wandsworth prison after his parents provided a £50,000 surety.

Sarao was before Westminster magistrates’ court on Tuesday morning for the latest hearing in the case. Appearing in the dock in a grey prison tracksuit, he spoke only to confirm his name and address.

After the brief hearing, his solicitor Richard Egan said his legal team planned to return to the high court for a second time.

In the high court last week, Mr Justice Cranston refused an attempt to vary Sarao’s bail conditions, saying that the application was “premature” until the trader proved he did not have access to any funds.

“It is impossible and in fact illegal to comply with the conditions, we’ll do as much as we can to prove that all the funds have been restricted,” Egan said.

Sarao was arrested last month after the US Department of Justice claimed he had made $40m (£27m) by “spoofing” financial markets, using commercially available trading software to place $200m of false trades from his parents’ home in Hounslow, west London.

US authorities said Sarao’s alleged manipulation contributed to the so-called flash crash on 6 May 2010, when the Dow Jones industrial average plunged 600 points in five minutes, creating havoc on Wall Street.

The trader has been remanded in custody since his arrest last month, when his bail was set at just over £5m. His lawyers had said Sarao’s trading account contained the funds, but they have since learned that his assets were subject to a freezing order by the US authorities, which made it impossible to produce the money.