Firm That Made $500 Million in Oil Crash Sued for Manipulation

Vega Capital London Ltd., the small London trading house that made $500 million in one day when the price of oil futures fell to -$37 a barrel in late April, was hit with a lawsuit in Chicago federal court claiming it engineered the oil crash through aggressive, coordinated sales.

“Standard and rational practice among market participants is to seek to sell for the highest price available,” the complaint says. “However, pursuant to their manipulative scheme, defendants repeatedly engaged in a highly unusual violation of this standard practice.”

The suit also targets up to 100 unidentified Vega traders. It accuses them ...