September 25, 2015 / 10:40 AM / 4 years ago

UK court postpones 'flash crash' trader's extradition hearing

LONDON (Reuters) - A decision on whether London-based trader Navinder Sarao should be sent to the United States to stand trial over his alleged role in causing the 2010 Wall Street “flash crash” was delayed until next year in a British court on Friday.

Navinder Sarao (C) arrives at Westminster Magistrates Court for an extadition hearing in London, September 25, 2015. The London-based trader accused by U.S. authorities of market manipulation that helped cause the 2010 Wall Street "flash crash" appeared in court on Friday to fight extradition to the United States to face trial. REUTERS/Peter Nicholls

Westminster Magistrates’ Court postponed Sarao’s extradition hearing until Feb. 4 after the United States added new allegations to their request for him and his senior defence lawyer was unable to attend court due to injury.

Arrested by British police on a U.S. warrant in April, Sarao has been indicted by a U.S. federal grand jury on 22 criminal counts including wire fraud, commodities fraud, commodity price manipulation and attempted price manipulation.

Lawyer Mark Summers, representing the United States at Friday’s hearing, told the court the revised extradition request contained allegations that had been made in the grand jury indictment.

These extended the alleged criminal activities by six months to the start of 2009 and added factual allegations about Sarao obtaining a customised trading programme.

Joel Smith, representing Sarao, said the trader’s legal team had only been informed of the new extradition warrant on Thursday night.

“Mr Sarao is understandably distressed. His mental health is fragile. It adds to the stress and strain these proceedings have put on him,” Smith told the court.

Chief Magistrate Howard Riddle said: “I share your dismay.”

The court also heard that senior lawyer James Lewis, who had been expected to speak for Sarao at the hearing, had been injured as he left his house on Friday morning. Riddle said Lewis had told him it was the first time in his career he had failed to make it to court.

The case was adjourned until Oct. 22 for further preliminary legal arguments on whether expert evidence about conduct in U.S. markets should be admissible, ahead of the substantive extradition next February.

Sarao, who attended the hearing in a grey suit and pink shirt, was released on bail.

The 36-year-old, who lives and worked at his parents’ modest home near Heathrow airport, is accused of using an automated trading programme to “spoof” markets by generating large sell orders that pushed down prices. He then cancelled those trades and bought contracts at lower prices, prosecutors say.

The flash crash saw the Dow Jones Industrial Average briefly plunge more than 1,000 points on May 6, 2010, temporarily wiping out nearly $1 trillion in market value.

Editing by Stephen Addison

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