"Flash crash" trader Navinder Singh Sarao to be freed on bail

 
Jessica Morris
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Sarao is accused of causing the 2010 US Flash Crash (Source: Getty)

The British trader accused of causing the 2010 US Flash Crash was released from prison today after being granted bail by a judge.

Navinder Singh Sarao, who has been held at Wandsworth prison since his arrest in April, had his bail reduced to £50,000 from £5m.

The US Justice Department (DoJ) subsequently said he can walk free if he comes up with the money in the coming weeks.

He still faces extradition to the United States on charges carrying a maximum sentence of 380 years. A full extradition hearing is due to take place in September.

Read more: What was the great Flash Crash of 2010?

Sarao had to tell the court that he had funds of more than £30m, with £25.5m of this held in Swiss accounts.

He'd previously argued he was unable to pay the bail because his assets had been frozen by the US authorities.

The so-called "flash crash trader" was arrested and charged in April amid allegations he used a “dynamic layering scheme to affect the price of [a type of futures contract]".

Essentially prosecutors say he made fake sell orders which he had no intention of honouring to drive down prices, before swooping on the cheap futures and then profiting when the market returned back to normal.

They argue that his actions resulted in the Flash Crash, which saw the Dow Jones index lose about $800bn (£511bn) in a matter of minutes, although it recovered the losses before the market close.

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