Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 1 of 21 PageID #:140
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`I
`*resr#,:,,f"u%
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`UNITED STATES DISTNCT COURT
`NORTHERN DISTRICT OF ILLINOIS
`EASTERN DIVISION
`
`I.INITED STATES OF AMERICA
`
`v.
`
`TIoNGSHENG ("JIM") ZHAO
`
`CASE NUMBER: 18 CR 24
`
`PLE,A AGREEMENT
`
`l.
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`This Plea Agreement between the Fraud Section, Criminal Division, United States
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`Department of Justice (the "governmenf') and defendant JIONGSIIENG ("JIM") ZHAO, and his
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`attorney, Theodore T. Poulos, of Cotsirilos, Tighe, Streicker, Poulos & Campbell, Ltd., is madepursuant
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`to Rule 1 1 of the Federal Rules of Criminal Procedure. The parties to this Plea Agreement have agreed
`
`upon the following:
`
`Charges in This Case
`
`2.
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`The Information in this case charges the defendant with one count of spoofing, in
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`violation of Title 7, United States Code, Sections 6c(a)(5)(C) and l3(a)(2).
`3.
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`The defendant has read the charges against him contained in the Information, and those
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`charges have been fully explained to him by his attorney.
`4,
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`The defendant fully understands tle nature and elements of the crimes with which he
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`has been charged.
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`Charge to Which Defendant Ts Pleading Guiltv
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`5.
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`By this Plea Agreement, the defendant agrees to enter a voluntary plea of guilty to
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`Count One of the Information, which charges the defendant with one count of spoofing, in violation of
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`Title 7, United States Code, Sections 6c(a)(5)(C) and l3(a)(2).
`
`-t-
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`

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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 2 of 21 PageID #:141
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`EsslrraL&sls
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`6.
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`The defendant will plead guilty because he is in fact guilty of the charges contained in
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`Count One of the Information. In pleading guilty, the defendant admits the facts alleged in Count One
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`of the Information as well as the facts set forth in Paragraph 7 of this Plea Agreement (collectively, the
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`"Facts"). The defendant further admits that the Facts establish his guilt beyond a reasonable doubt.
`7,
`At all relevant times, ZHAO was employed as a trader at Trading Firm A that was
`headquartered in Sydney, Australia . Z1A}resided and worked in Australia. When trading, ZHAO
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`placed orders manually, meaning he physically clicked his computer mouse or hit keyboard keys to
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`place each order, and physically cticked his mouse or hit keyboard keys to cancel an order. Among
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`other things, ZHAO traded E-mini S&P 500 futures contracts on the Chicago Mercantile Exchange
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`("CME'), which is a commodities exchange operated by the CME Group Inc., a commodities
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`marketplace located in Chicago, Illinois, with its servers located in the Northern District of Illinois. At
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`all relevant times, the CME was a registered entity, operating as a Designated Contract Mat'ket, and
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`subject to regulation by the U,S. Commodity Futures Trading Commission. Marketparticipants trading
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`on the CME were subject to its rules.
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`Spoof Orders
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`From approximately luly 2012 and continuing through approximately March 2016 (the
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`"Relevant Period"), ZHAO placed thousands of orders on the CME for E-mini S&P 500 futures
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`contracts that, at the time ZHAO placed the orderc, he intended to cancel before execution (the "Spoof
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`Orders"). Typically, ZHAO engaged in this trading strategy when ZHAO already had an order for
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`E-mini S&P 500 futures contracts pending in the marketthalZHAO did want to execute, but was not
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`being filled (the "Primary Order"). ZHAO would place the Spoof Orders on the opposite side of the
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`-2-
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`

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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 3 of 21 PageID #:142
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`marl(et from the Primary Order with the goal to induce other market participants to flade against
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`ZIIAO's Primary Order. At times, ZHAO's Spoof Orders did, in fact, cause other market participants
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`to react and to trade at prices, quantities, and times that they likely otherwise would not have traded,
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`but for ZHAO's Spoof Orders, and which resulted in ZHAO's Primary Order being filled. Frequently,
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`once ZIIAO's Spoof Orders served their purpose and his Primary Order was filled, ZHAO quickly
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`cancelled the Spoof Orders. ZHAO's trading strategy was intended to, and did, transmitmaterially false
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`and misleading liquidify and price information and otherwise deceive other market patticipants about
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`the existence of supply and demand for E-mini S&P 500 futures contracts. The Spoof Orders were
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`designed to, and did, artificially move the price of E-mini S&P 500 futures contracts in a direction that
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`was favorable to ZHAO, and to the detriment of other market participants.
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`ZHAO placed the Spoof Orders in order to generate profits (or mitigate losses) for
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`himself and Trading Firm A, ZHAO personally benefited from using Spoof Orders in numerous ways,
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`including by way of continued employment and compensation from Trading Firm A, which
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`compensation was based in part on his trading profits. As part of ZF{AO's employment contract with
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`Trading Firm A, during the Relevant Period, Trading Firm A kept a percentage of ZHAO's trading
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`profits, ranging at vzuious times from 20%oto 50%. During the Relevant Period, when placing the Spoof
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`Orders, ZHAA (i) was an employee of Trading Firm A, (ii) acted with the intent, at least in part, to
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`benefit Trading Firm A, and (iii) acted within the scope of his authority and employment at Trading
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`Firm A. ZHAO agrees that the United States has calculated that Spoof Orders ZHAO himself placed
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`generated trading gains to himself and Trading Firm A of approximately $21,000 and caused market
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`losses of approximately $464,000, ZHAO acted knowingly and willfully in submitting Spoof Orders.
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`-3-
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`

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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 4 of 21 PageID #:143
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`The Spoof Orders constituted foreign and interstate wire communications because
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`ZHAO electronically placed, and caused to be placed, the orders onto the CME fiom computers at his
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`home or Trading Firm A's offices in Sydney, Australia.
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`The Spoof Orders included, but were not limited to:
`
`Approx. Date
`
`Approx. Time
`(Central Time)
`
`Side
`
`Approx.
`Price
`
`Approx.
`Number of
`Contracts
`in Spoof
`Order
`
`Approx. Total
`Value of
`Spoof Order
`
`Approx.
`Period of
`Time Spoof
`Order Was
`Active
`
`June 30,2013
`
`July 12,2013
`
`July 12,2013
`
`09:37:18.600 PM Sell
`02:09:53.733 AM Buy
`02:10:06.251 AM Sell
`
`$l,595.50
`
`$t,667.25
`
`$ 1,667.50
`
`July 29,2013
`
`08:33:59.830 PM Buy
`
`$1,685.25
`
`July 29,2013
`
`08:34:29.003 PM Sell
`
`$1,685.50
`
`August 26,2013
`
`09:54:50.629 PM Sell
`
`$1,652.00
`
`August 26,2013
`
`09:54:57.019 PM Sell
`
`$1,652.00
`
`August 27,2013
`
`ll:39:37.772PM Buy
`
`151
`
`151
`
`r51
`
`20r
`
`201
`
`20t
`
`201
`
`20t
`
`$12,046,025.00
`
`0.814 secs
`
`$72,587,737.50
`
`0.719 secs
`
`$12,589,625.00
`
`0.826 secs
`
`sL6,936,762.50
`
`0.671 secs
`
`$t6,939,275.00
`
`0.689 secs
`
`$16,602,600.00
`
`0.752 secs
`
`$16,602,600.00
`
`0.799 secs
`
`$16,371,450.00
`
`0.687 secs
`
`$1,629.00
`
`August 27,2013
`
`ll:39:57.927 PM Sell
`
`$1,629.25
`
`March 12,2014
`
`March 24,2014
`
`March 24,2014
`
`March 26,2014
`
`December 7,2015
`
`December 7,20Ls
`
`December 22,2015
`
`December 22,2015
`
`January 15,2016
`
`10:52:22.441PM Buy
`12:10:09,804 AM Buy
`l2:11:01.303 AM Sell
`
`I 1:55:53.892 PM Buy
`03:15:57.994 AM Sell
`03:16:03.202 AM Sell
`03:45:43.179 AM Buy
`06:45:46.640 AM Buy
`06:08:59.223 AM Sell
`
`$1,873.25
`
`$1,857.00
`
`$1,857.25
`
`$ 1,845.25
`
`$2,094.25
`
`$2,094.25
`
`$2,008.00
`
`$2,008.25
`
`$1,885.00
`
`January 26,2016
`
`0l:08:59,811AM Sell
`
`$t,862.75
`
`-4-
`
`201
`
`201
`
`201
`
`201
`
`201
`
`101
`t5l
`t52
`t52
`t52
`t52
`
`$t6,373,962.50
`
`0.705 secs
`
`$18,826,162.50
`
`0.591 secs
`
`$18,662,850.00
`
`0.579 secs
`
`$18,665,362.50
`
`0.623 secs
`
`$18,544,762.50
`
`0.640 secs
`
`$10,575,962.50
`
`0.663 secs
`
`$15,8I 1,587.50
`
`0.675 secs
`
`$15,250,800.00
`
`0.880 secs
`
`$15,262,700.00
`
`0.705 secs
`
`$14,326,000.00
`
`0.727 secs
`
`$ 14,156,900.00
`
`0.688 secs
`
`

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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 5 of 21 PageID #:144
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`Approx. Date
`
`Approx. Time
`(Central Time)
`
`Side
`
`Approx.
`Price
`
`February 10,2016
`
`March 2,2016
`
`March 7,2016
`
`05:29:54.776 AM Sell
`04:30:49.701 AM Buy
`03:45:10.192 ANI Sell
`
`$1,867.75
`
`$1,973.25
`
`$2,026.75
`
`The CME Investigation
`
`Approx.
`Number of
`Contracts
`in Spoof
`Order
`tsl
`t62
`
`Approx. Total
`Value of
`Spoof Order
`
`Approx.
`Period of
`Time Spoof
`Order Was
`Active
`
`$14,101,512.50
`
`0.720 secs
`
`$ 15,983,325.00
`
`0.671 secs
`
`152
`
`$15,403,300.00
`
`0.778 secs
`
`In approximately March 2016, the CME began an investigation into ZHAO's trading
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`activity in connection with the E-mini S&P 500 futures contracts. As part of that investigation,ZHAO
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`submitted to an interyiew with the CME, and provided written responses, to explain his trading activity.
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`ZHAO knew that he was obligated to be truthful in his interview with, and written response to, the
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`CME, and knew the CME was acting in furtherance of its official duties under Title 7, United States
`
`Code, Chapter 1 during its investigation. ZHAO responded to the CME (i) as an employee of Trading
`
`Firm A, (ii) acting with the intent, at least in part, to benefit Trading Firm A, and (iii) acting within the
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`scope of his authority and employment at Trading Firm A.
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`As part of its investigation, the CME identified three specific examples of ZIIAO's
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`trading activity that occured on December 7 and 22,2015, and March 7,20L6. In a written response
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`submitted to the CME , ZHAO stated that all of the orders identified in the tlu'ee examples were paft of
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`either a "scalping" or spread trading strategy and were placed with the intention to execute. In truth
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`and in fact, however, whenproviding this response to the CME, ZHAO well knew that, for certain large
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`orders identified in each example, he had placed these large orders with the intent, at the time they were
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`placed, to cancel them before execution. That is, these large orders were Spoof Orders. ZHAO's
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`statement that he placed these large orders with the intention thatthey be filled was false and misleading,
`
`-5-
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`

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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 6 of 21 PageID #:145
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`and it was material to the CME's investigation into ZFIAO's trading activity. ZHAO made this false
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`statement knowingly and willfully, in order to falsifu, conceal, and cover up his spoofing conduct.
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`ZHAO retained counsel to represent him in connection with the CME investigation, and ZHAO
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`knowingly used his counsel as a conduit to convey this same false and misleading information to the
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`CME.
`
`8,
`factual basis exists for the defendant's plea of guilty, and are not intended to be a complete or
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`The foregoing Facts are set forth solely to assist the Court in determining whether a
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`comprehensive statement of all the facts within the defendant's personal knowledge regarding the
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`charged crime and related conduct.
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`@ies
`The defendant understands that the charge to which he is pleading guilty carries the
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`9,
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`fo llowing statutory penalty :
`a. A maximum sentence of ten years' imprisonment. The statutory maximum
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`period of imprisonment for Count One (spoofing) is ten years. The defendant further understands
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`that the Court also may impose a term of supervised release of not more than three years for this
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`offense.
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`b. A criminal fine of $ 1,000,000, or twice the gross gain or gross loss resulting
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`from the offense, whichever is greater.
`c.
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`The defendant further understands that, pursuant to Title 18, United States
`
`Code, Section 36634, the Court must order restitution for persons directly and proximately harmed
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`as a result of the defendant's violation of Count One (spoofing), in an amount determined by the
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`Court.
`
`-6-
`
`

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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 7 of 21 PageID #:146
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`d.
`
`In accord with Title 18, United States Code, Section 3013, the defendant must
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`pay a mandatory special assessment of $ I 00 (S I 00 on each count to which he has pleaded guilty), in
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`addition to any other penalty, forfeiture, or restitution imposed.
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`Sentencing Guideline$ Calculations
`10. The defendant understands that in imposing sentence the Court will be guided by the
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`United States Sentencing Guidelines. The defendant understands that the Sentencing Guidelines are
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`advisory, not mandatory, but that the Court must calculate the applicable Sentencing Guidelines tange,
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`and to consider that range, possible departures under the Sentencing Guidelines, and other sentencing
`
`factors under 18 U.S,C. $ 3553(a), which include: (i) the nature and circumstances of the offense and
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`the history and characteristics of the defendant; (ii) the need for the sentence imposed to reflect the
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`seriousness of the offense, promote respect for the law, and provide just punishment for the offense,
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`afford adequate detenence to criminal conduct, protect the public from fuither crimes of the defendant,
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`and provide the defendant with needed educational or vocational training, medical care, or other
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`correctional treatment in the most effective manner; (iii) the kinds of sentences available; (iv) the need
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`to avoid unwaranted sentence disparities among defendants with similar records who have been found
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`guilty of similar conduct; and (v) the need to provide restitution to any victim of the offense,
`11. For purposes of calculating the Sentencing Guidelines, the parties agree on the
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`following points:
`a.
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`Applicable Guidelines. The Sentencing Guidelines to be considered in this case
`
`are those in effect at the time of sentencing. The following statements regarding the calculation of the
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`Sentencing Guidelines are based on the Guidelines Manual cun'ently in effect, namely the November l,
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`20 I 8 Guidelines Manual,
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`-7-
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`

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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 8 of 21 PageID #:147
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`b.
`
`Offense Level Calculations.
`i.
`
`For Count One, the base offense level is 6, pursuant to Guideline
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`$ 2Bl.l(a)(2).
`
`ii.
`
`The parties agree that, pursuant to Guideline $ 28i.1(b)(l), a loss
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`assessment is appropriate.
`iii,
`
`Pursuant to Guideline $ 281.1(b)(2XAXD, defendant's offense level is
`
`increased by 2 levels because the offense involved l0 or more victims.
`iv.
`
`Pursuant to Guidelin. 5E Znt.t(bxl0), defendant's offense level is
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`increased by 2 levels because the offense involved sophisticated means.
`v.
`
`Defendant has clearly demonstrated a recognition and affirmative
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`acceptance of personal responsibility for his criminal conduct. If the government does not receive
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`additional evidence in conflict with this provision, and if defendant continues to accept responsibility
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`for his actions within the meaning of Guideline $ 3E1.1(a), including by furnishing the Fraud Section
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`and the Probation Office with all requested financial information relevant to his ability to satisff any
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`fine, forfeiture, or restitution that may be imposed in this case, a two-level reduction in the offense
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`level is appropriate.
`vi.
`
`In accord with Guideline $ 3E1.1(b), defendant has timely notified the
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`government of his intention to enter a plea of guilty, thereby permitting the government to avoid
`
`preparing for trial and permiuing the Court to allocate its resources efficiently. Therefore, as provided
`
`by Guideline $ 381.1(b), if the Court determines the offense level to be 16 or greater prior to
`
`determining that defendant is entitled to a two- level reduction for acceptance of responsibility, the
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`government will move for an additional one-level reduction in the offense level.
`
`-8-
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`

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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 9 of 21 PageID #:148
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`c. Criminal History Category. With regard to determining the defendant's
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`criminal history points and uiminal history category, based on the facts now known to the government,
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`deftndant's criminal history points equal zero and the defendant's criminal history category is I.
`d.
`
`Joint Sentencing Recommendation. The government and the defendant agree
`
`to jointly recommend that the defendant be sentenced to a period of one year and one day (12 months
`
`plus one day) imprisorunent, with credit for time already served in United States and Australian facilities.
`e.
`
`Defendant and his attorney and the government acknowledge that the above
`
`guidelines calculations are preliminary in nature, and are non-binding predictions upon which neither
`
`party is entitled to rcly. Defendant understands that further review of the facts or applicable legal
`
`principles may lead the government to conclude that different or additional guidelines provisions apply
`
`in this case. Defendant understands that the Probation Office will conduct its own investigation and that
`
`the Court ultimately determines the facts and law relevant to sentencing, and that the Court's
`
`determinations govern the final guideline calculation. Accordingly, the validity of this Plea Agreement
`
`is not contingent upon the probation officer's or the Court's concurence with the above calculations, and
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`defendant shall not have a right to withdraw his plea on the basis of the Court's rejection of these
`
`calculations.
`
`f.
`
`Both parties expressly acknowledge that this Plea Agreement is not governed by
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`Fed. R. Crim. P. I l(c)(l)(B), and that errors in applying or interpreting any of the Sentencing Guidelines
`
`may be corrected by either party prior to sentencing. The parties may cot.rect these erors either by
`
`stipulation or by a statement to the Probation Office or the Court, setting forth the disagreement regalding
`
`the applicable provisions of the guidelines. The validity of this Plea Agreement will not be affected by
`
`-9-
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`

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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 10 of 21 PageID #:149
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`such corections, and the defendant shall not have a right to withdraw his plea, nor the government the
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`right to vacate this Plea Agreement, on the basis of such corrections.
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`Cooperation
`
`t2.
`
`The defendant agrees he will fully and truthfully cooperate in any matter in which he is
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`called upon to cooperate by a reprcsentative of the Fraud Section. This cooperation shall include making
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`himself physically available in Washington, D.C, or the Northern District of Illinois for, and providing
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`complete and truthful information during, any investigation and pre-trial preparation and complete and
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`truthful testimony in any criminal, civil, or administrative proceeding. The defendant agrees to the
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`postponement of his sentencing until after the conclusion of his cooperation. The defendant further
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`agrees to make himself available by telephone within seven (7) calendar days of any l'equest by the
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`Fraud Section.
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`Agreements Relating to Sentencing
`
`1 3 .
`
`The parties agree that, on January 29 ,2018,the defendant was amested by the Australian
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`Federzl Police and remanded into custody pending extradition to the United States. Pursuant to 18
`
`U.S.C. $ 3585(b), the defendant shall be given credit for the time that the defendant has spent in custody
`
`toward the service of any term of imprisonment imposed for the offense that the defendant is pleading
`
`guilty to in Count One of the Information. The parties agree that upon entry of a guilty plea in open
`
`court, the parties will jointly move the Court to order the Bureau of Prisons prior to sentencing to
`
`calculate the duration of time that the defendant has aheady served in custody.
`14. At the time of sentencing, the government shall make known to the sentencing judge
`
`the extent of the defendant's cooperation. If the government determines, in its sole discretion, that the
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`defendant has provided full and truthful cooperation as required by this Plea Agreement, and has
`
`rendered substantial assistance, then the government shall move the Court, pursuant to Guideline
`-10-
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`

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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 11 of 21 PageID #:150
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`$ sKl.l, to depart downward from the low end of the applicable guideline range. The defendant
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`understands that the decision to depart from the applicable guideline range rests solely with the Court.
`15.
`
`If the government does not move the Court, pursuant to-Guideline $ 5I(1. [, to depart
`
`from the applicable Guideline range, as set forth above, the preceding paragraph of this Plea Agreement
`
`will be inoperative, both parties shall be bound to request a sentence as set forth in Paragraph 13, and
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`the Court shall impose a sentence taking into consideration the factors set forth in 18 U.S.C. $ 3553(a)
`
`as well as the Sentencing Guidelines without any downward departure for cooperation pursuant to
`
`$ 5K1.1. The defendant may not withdraw his plea of guilty because the government has failed to make
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`a motion pursuant to Guideline $ 5K1.1 .
`16.
`
`[t is understood by the parties that the sentencing judge is neither a party to nor bound
`
`by this Plea Agreement and may impose a sentence up to the maximum penalties as set forth above.
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`The defendant further acknowledges that if the Court does not accept the sentencing recommendation
`
`of the parties, the defendant will have no right to withdraw his guilty plea.
`l7 ,
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`The defendant agrees to pay the special assessment of $100 at the time of sentencing
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`with a cashier's check or money order payable to the Clerk of the U.S. District Court.
`18.
`
`If the Court should order restitution, the defendant agrees to the entry of a Restitution
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`Order for the full amount of the victims' losses as determined by the Court. Pursuant to 18 U.S.C.
`
`$ 3663A(c)(2),the defendant agrees that an offense listed in 18 U.S.C. $ 3663A(c)(1) gave rise to this
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`Plea Agreement and as such, victims of the conduct described in the Information, Factual Basis, or any
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`related or similar conduct shall be entitled to restitution. The parties further acknowledge, however,
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`that pursuant to 18 U.S.C. $ 3663A(c)(3), and based on information cumently available to the
`
`government: (i) determining complex issues of fact relating to the amount of the victims' losses would
`
`-l l-
`
`

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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 12 of 21 PageID #:151
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`complicate or prolong the sentencing process to a degree that the need to provide restitution to any
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`victim may be out'weighed by the burden on the sentencing process; and (ii) the number of identifiable
`
`victims may be so large as to make restitution impracticable. To that end, the defendant agrees, pursuant
`
`to 18 U.S.C. g 3664(dX5), that the court may defer the imposition of restitution, if any, until after the
`sentencing; however, defendant specifically waives the 90-day provision found at 18 U.S.C.
`
`$ 3664(dX5). The defendant also consents to the government filing a motion with the Court seeking
`authorization to use alternative victim notification procedures pursuant to 18 U.S.C. $ 3771(dX2).
`
`Defendant further acknowledges that, pursuant to 18 U.S.C. $ 3664(k), he is required to notify the Court
`
`and the Fraud Section of any material change in economic circumstances that might affect his ability to
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`pay restitution.
`19. The defendant agrees to disgorge proceeds he earned from the criminal conduct which
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`is the subject ofthis Plea Agreement. The government has calculated such proceeds to be approximately
`
`$21,000, and the defendant reselves the right to present evidence that reduces the appropriate amount
`
`of disgorgement. Any such evidence must be provided to the government no later than forty-five (45)
`
`days prior to sentencing. The defendant shall not be required to disgorge the proceeds of identical
`
`conduct for which he is ordered to disgorge proceeds in a parallel civil or regulatory proceeding before
`
`the U.S. Comrnodity Futures Trading Commission.
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`Acknowledgments and Waivers Regarding PIea of Guilty
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`Nature of Aqreement
`20. This Ptea Agreement is entirely voluntary and represents the entire agreement between
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`the Fraud Section and the defendant regarding defendant's criminal liability in case 18 CR 24.
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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 13 of 21 PageID #:152
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`21. Except as set forth in this PIea Agreement, the Fraud Section agrees that it will not
`initiate further criminal charges against the defendant based on conduct set forth in the criminal
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`information and this agreement.
`22. This Plea Agreement concerns criminal liability only. Except as expressly set fodh in
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`this Plea Agreement, nothing herein shall constihrte a limitation, waiver, or release by the United States
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`or any of its agencies of any administrative or judicial civil claim, demand, or cause of action it may
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`have against the defendant or any other person or entity. The obligations of this Plea Agreement are
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`Iimited to the Fraud Section and cannot bind any other federal, state, or local prosecuting,
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`administrative, or regulatory authorities, except as exprcssly set forth in this Plea Agreement.
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`Waiver of Riehts
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`23.
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`The defendant understands that by pleading guilty he sumenders certain rights,
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`including the following:
`a. Trial rights. The defendant has the right to persist in a plea of not guilty to
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`the charges against him, and if he does, he would have the right to a public and speedy trial.
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`The trial could be either ajurytrial or atrial by thejudge sittingwithout
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`a jury. However, in order that the trial be conducted by the judge sitting without jury, the defendant,
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`the government, and the judge all must agree that the trial be conducted by the judge without a jury.
`ii.
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`If the trial is a jury trial, the jury would be composed of twelve citizens
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`from the district, selected at random. The defendant and his attomey would participate in choosing
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`the jury by requesting that the Couft remove prospective jurors for cause where actual bias or other
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`disqualification is shown, or by removing prospective jurors without cause by exercising peremptoly
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`challenges.
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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 14 of 21 PageID #:153
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`I ll.
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`If the trial is a jury trial, the jury would be instructed that the defendant
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`is presumed innocent, that the government has the burden of proving the defendant guilty beyond a
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`reasonable doubt, and that the jury could not convict him unless, after hearing all the evidence, it was
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`persuaded of his guilt beyond a reasonable doubt. The jury would have to agree unanimously before
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`it could return a verdict of guilty or not guilty.
`iv.
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`If the trial is held by the judge without a jury, the judge would find the
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`facts and determine, after hearing all the evidence, whether or not the judge was persuaded that the
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`government had established the defendant's guilt beyond a reasonable doubt.
`v.
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`At a trial, whether by a jury or a judge, the government would be
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`required to present its witnesses and other evidence against the defendant. The defendant would be
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`able to confront those government witnesses and his attorney would be able to cross-examine them.
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`vl.
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`At a trial, the defendant could present witnesses and other evidence on
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`his own behalf, If the witnesses for the defendant would not appear voluntarily, he could require
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`their attendance through the subpoena power of the Court. A defendant is not required to present any
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`evidence.
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`vlt,
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`At a trial, the defendant would have a privilege against self-
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`incrimination so that he could decline to testi!, and no inference of guilt could be drawn fi'om his
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`refusal to testifu. If the defendant desired to do so, he could testi$ on his own behalf.
`24. Waiver of appellate and collateral rights. The defendant frrrther understands he is
`waiving all appellate issues that might have been available if he had exercised his right to trial. The
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`defendant is aware that Title 28, United States Code; Section 1291, and Title 18, United States Code,
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`Section 3742, afford a defendant the right to appeal his conviction and the sentence imposed.
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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 15 of 21 PageID #:154
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`Acknowledging this, the defendantknowingly waives the rightto appeal his conviction, pre-trial rulings
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`by the Courl, and his right to challenge his sentence, and the manner in which the sentence was
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`determined, including any term of imprisonment and fine within the maximums provided by law, and
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`including any order of restitution and forfeiture, and (in any case in which the term of imprisonment
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`and fine are within the maximums provided by statute) his attorney's alleged failure or refusal to file a
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`notice of appeal, in any collateral affack or future challenge, including but not limited to a motion
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`brought under Title 28, United States Code, Section 2255,inexchange for the concQssions made by the
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`government in this Agreement. This includes a waiver of right to challenge the constitutionality,
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`whether facially or as applied, of statutes to which the defendant is pleading guilty. The waiver in this
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`paragraph does not apply to a claim of involuntariness, or ineffective assistance of counsel, which relates
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`directly to this agreement or to its negotiation, nor does it prohibit the defendant from seeking a
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`reduction of sentence based directly on a change in the law that is applicable to the defendant and that,
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`prior to the filing of defendant's request for relief has been expressly made retroactive by an Act of
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`Congress, the Supreme Court, or the United States Sentencing Commission.
`25, The defendant hereby waives any and all objections, motiorls, and defenses based upon
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`the Statute of Limitations or venue in the Northern District of Illinois.
`26, The defendant understands that by pleading guilty he is waiving all the rights set forth
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`in the prior parzgraphs. The defendant's attomey has explained those rights to him, and the
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`consequences of his waiver of those rights.
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`Presentence Investieation ReportlPost-Sentence $unervision,
`27, The defendant understands that the Fraud Section, in its submission to the Probation
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`Office as part of the Pre-Sentence Report and at sentencing, shall fully apprise the District Court and
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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 16 of 21 PageID #:155
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`the Probation Office of the nature, scope, and extent of the defendant's conduct regarding the charge
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`against him, and related matters. The government will make known all matters in aggravation and
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`mitigation relevant to sentencing, including the nature and extent of the defendant's cooperation.
`28. The defendant agrees to truthfully and completely execute a Financial Statement (with
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`supporting documentation) prior to sentencing, to be provided to and shared among the Coutt, the
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`Probation Office, and the Fraud Section, r'egarding all details of his financial circumstances, including
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`his recent income tax returns as specified by the probation officer. The defendant understands that
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`providing false or incomplete information, or refusing to provide this information, may be used as a
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`basis for denial of a reduction for acceptance of responsibility pursuant to Guideline $ 3E1.1 and
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`enhancement of his sentence for obstruction ofjustice under Guideline $ 3C l.l, and may be prosecuted
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`as a violation of Title 18, United States Code, Section 1001 or as a contempt of the Court.
`29, For the purpose of monitoring the defendant's compliance with his obligations to pay
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`a fine and restitution during any term of supervised release or probation to which the defendant is
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`sentenced, the defendant fufther consents to the disclosure of his tax returns (together with extensions,
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`corespondence, and other tax information) and reiated tax filings and materials to the Probation Office
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`and the Fraud Section filed subsequent to the defendant's sentencing, to and including the final year of
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`any period of supervised release or probation to which the defendant is sentenced.
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`AEsI-Ierss
`30, The defendant agrees to cooperate with the Fraud Section in collecting any unpaid fine
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`and restitution for which the defendant is liable, including, upon request, providing financial statements
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`under oath or affirmation and supporting records and submitting to interviews by the United States and
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`the U.S. Probation Office regarding the defendant's capacity to satisfy any fines or restitution.
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`Case: 1:18-cr-00024 Document #: 49 Filed: 12/26/18 Page 17 of 21 PageID #:156
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`31. The defendant understands that any person convicted of a felony under Title 7, United
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`States Code, Section 13 shall be suspended from registration under that chapter and shall be denied
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`registration or re-registration for five years or such longer period as the CFTC may determine, and
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`barred fi'om using, or participating in any manner in, any market regulated by the CFTC for five years
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`or such longer period as the CFTC shall determine, on such tetms and conditions as the CFTC may
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`prescribe, unless the CFTC determines otherwise. The defendant understands that nothing in this
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`agreement alters the CFTC's statutory authority or discretion to effect any such suspension, denial, or
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`bar against him, or otherwise binds the CFTC in any way. The defendant nevertheless affirms that
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`defendant wants to plead guilty regardless of any collateral consequences that the defendant's ple