Theory Of Spoofing

Fraudulent transactions,or false declarations,is a distortion of supply and demand in the market through massive and repeated declarations and withdrawals,and also an act formed by the market mechanism.Fraudulent frauds occur mostly in the context of programmatic transactions and high-frequency transactions,and their harmfulness and multiplicity are increasingly prominent in modern capital markets.It is necessary to explore the criminal regulation path of fraudulent frauds.Countries and regions with relatively developed capital markets carry out sanctions against scam fraud with their abstract anti-manipulation clauses or special anti-spoofing clauses,of which the United States has both the above two models and forms the world 's first scam conviction.The U.S.stock market and the futures market before the introduction of the 2010 Dodd-Frank Act mainly used market manipulation to characterize and regulate fraudulent transactions,while the futures market after the introduction of the Dodd-Frank Act mainly regulated by spoofing clauses.Thus,US has formed its unique rules of determination in judicial practice.Although Article 182 of China's Criminal Law does not clearly indicate types of conduct in this case,the Supreme Court and Supreme Prosecution have made a false interpretation in the "Interpretation of Several Issues Concerning the Application of Laws in Handling Criminal Cases of Manipulating the Securities and Futures Market" through judicial interpretation of the bottom clause,putting false declarations into market manipulation and setting corresponding objective and subjective requirements.Focusing on the scam deception provisions in the judicial interpretation,combined with the experience of the United States and other countries and regions outside the region,this article will build a set of identification systems that are in line with the reality of China's capital market.The author will compare and discuss the criminal regulation path of guilty fraud through four chapters.The first chapter starts with the economic mechanism of fraudulent fraud,deconstructs the principles and models of fraudulent fraud with financial theory and technology,examines the harm of fraudulent fraud from the perspective of market influence,and conducts test of fraudulent fraud with a special market ethic.The study found that the behavior mechanism of any fraudulent behavior is generally the same,which is based on a large number of pending orders and withdrawal orders that are not intended to be transactions,forming a false image of market supply and demand,inducing other investors to follow the order,thereby affecting the market such as price or transaction volume.Fraudulent crimes are extremely harmful to the market and can easily induce systemic risks.They also constitute a violation of fair ethical principles.The second chapter,based on economic analysis,carries out the analysis of legal attribute,and strives to form a clearer understanding of the essence of scams.This is not only conducive to the correct selection and application of laws,but also avoids behaviors that do not conform to its substance from being mistakenly included in the supervision vision of the supervisory authority.Theorists' views on the substantial market manipulation mainly focus on price-volume manipulation theory,misconduct theory,fraud theory,elements of unjustified control theory,and advantage abuse theory,but the above theories have their own limitations.This article puts forward the substantive cognition of market manipulation,namely,the essence of market manipulation,including scams,lies in the distortion of behavior on the market mechanism of the market.Specifically,it affects the natural supply-demand in the market through trading behavior or information behavior,then distort how marketconditions form naturally.The transaction or information behavior that is not under the control of the institutional value of the capital market or consistent with the purpose of basic functions of the market,affects the formation process of the market quotation in varying degrees,which can be said to "distort" the market quotation mechanism.In short,the implementation of transactions or information behaviors that affect the market must lack the legitimate transaction purpose required by the market.The third chapter compares and investigates the criminal regulation practice of fraud in extraterritorial countries?regions?.The United States and the European Union have adopted specific legislation against scams,while Japan,Taiwan,and Hong Kong regulated this behavior through abstract anti-manipulation clauses.However,on the one hand,because the normative system of fraudulent fraud outside the territory generally needs to be improved,on the other hand,the fraudulent behavior itself is relatively complex,concealed,and of various types.Therefore,the regulation of fraudulent fraud outside the territory is mainly concentrated on the administrative and civil levels,and criminal regulation practices are few,except for the United States.This article will select the United States as the key comparison object and conduct a detailed investigation on its legislative and judicial levels.With the deepening of understanding of the theory of fraudulent crimes formed by the US official departments,and considering the practical need to reduce the difficulty of proving,it mainly used the the price manipulation clauses of Securities Trading Act and Commodity Trading Act before the introduction of the Dodd-Frank Act,and mainly regulate according to the new fraudulent provisions of the Commodity Trading Law after Dodd-Frank Act.Combined with specific cases,this article summarizes the standards for judicial determination of fraudulent crimes in the United States before and after the Dodd-Frank Act,and separately discusses the indirect proof methods of legislative clarity,objective behavior performance,and subjective intentions.The fourth chapter explores the path of criminal rules for fraudulent fraud in our country,and constructs a system for determining fraudulent fraud that is in line with China's actual situation.At the level of norms,China's old fraudulent criminal normsystem is relatively rough and has large legislative flaws,making it difficult to adapt to the complex needs of criminal justice.The promulgation of the judicial interpretations of the Supreme Court and the Supreme Prosecution and the amendments to the Securities Law have made up for the defects of the regulatory system to some extent,but some of the systemic issues have not been resolved under the new regulatory system,especially regulatory documents belong to a lower legal hierarchy.The problems of operability and rationality limit the effective operation of this institution.This article will sort out the constituent elements of the fraudulent behavior according to the provisions of the judicial interpretations of the Supreme Court and the Supreme Prosecution,establish rules for the determination of fraudulent behavior,and at the same time investigate whether the judicial interpretation conforms to legal principles,economic mechanisms and regulatory practices.By deconstructing the objective elements of the spoofing clause,it can be found that "frequent or large amount of withdrawals" is a specific behavior pattern of spoofing,where the "frequent or large amount" element reflects the abnormality of the behavior,thus proving the risk element of "affecting transaction price or transaction volume";"misleading investors to make investment decisions" is a stage through which false declarations act on market conditions,and can also be presumed by behavior;reverse trading or seeking related benefits is the second-stage behavior,its maintenance and abandonment are left to be discussed.Subjectively,the fraudulent crime must be "not for the purpose of closing the transaction",and this element should be indirectly proved by combination of environment evidences.As for the specific purpose similar to "inducing others" or "influencing the market",the author believes that it is not necessary,only that the trading behavior lacks the legitimate trading purpose required by the market should be considered in this case.