By David Ingram
WASHINGTON, Nov 26 (Reuters) - The U.S. Commodity Futures
Trading Commission on Monday sued the owner of the prediction
market and betting website Intrade, alleging that the company
allowed unauthorized trading by U.S. customers.
The civil suit, filed in U.S District Court in Washington,
D.C., said Intrade offered trading to U.S. customers on the
future prices of commodities such as gold and crude oil despite
a 2005 agreement not to offer trades on those and other items.
Intrade, based in Dublin, Ireland, did not immediately
respond to a request for comment.
The electronic exchange offers a wide array of subjects to
bet on, such as which film will win the Academy Award for Best
Picture or whether Syria President Bashar al-Assad will remain
in power into 2013.
Intrade is not supposed to accept or execute orders from
U.S. customers on subjects that fall within the CFTC's ban on
trading options off-exchange, but it did so from September 2007
through June 2012, the suit said.
The suit further alleged that the company misled the CFTC by
submitting a form each year certifying that it limited trades to
eligible participants when it did not.
The commission notified Intrade's parent company, Trade
Exchange Network Ltd, of alleged violations of their 2005
agreement in March, but the company "has failed to cure, or
attempt to cure, its violations," the suit said.
The suit asks a federal judge to find Intrade in violation
of federal commodities law, issue an injunction against any
illegal conduct and fine the company.
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