Navinder Singh Sarao, also known as Nav, was not your typical Wall Street trader. He didn’t strut around Manhattan in an Armani suit, nor did he brag about million-dollar deals over cocktails. Instead, Nav worked from his bedroom in a modest London suburb, far from the glamour of the financial world. But that didn’t stop him from becoming one of the most notorious traders in history. His story begins in the early 2000s, when he started day trading stocks, quickly realizing that with the right skills, you didn’t need a fancy degree or a corner office to make a fortune. He had this attention to detail and ability not to let bad days get to him that made him find success within his first year.
By 2010, Nav had honed a unique and dangerous talent. He discovered he could manipulate the market using a tactic called "spoofing." Here’s how it worked: Sarao would place huge sell orders for stocks, making it look like there was a rush to sell. Naturally, when the market saw these orders, prices would drop. The catch? He had no intention of actually selling those stocks. Before anyone caught on, he’d cancel his fake sell orders, buy stocks at new, lower prices, and sell them once they rebounded. It was like tipping the scales in a rigged game—and it made him millions.
Nav played this game for years. He wasn’t a household name, but he didn’t need to be. Behind the scenes, he was raking in millions and outsmarting the big guys on Wall Street. But on May 6, 2010, things took a dramatic turn. That day, the U.S. stock market went into freefall, plummeting nearly 1,000 points in just minutes. This wasn’t just a bad day at the office—stocks like Procter & Gamble tanked over 30%, and more than a trillion dollars in value evaporated before anyone knew what was happening.
As news anchors scrambled to explain the Flash Crash, no one suspected that a trader sitting on his bed halfway across the world was a key player in the chaos. Sarao’s spoofing contributed to the market’s dive, setting off panic like dominos. And yet, in the days and months that followed, he went right back to his trading screens, as if nothing had happened.
But markets are like elephants—they never forget. By 2014, U.S. regulators had traced the Flash Crash back to Sarao’s bedroom. The FBI knocked on his door, and in that moment, the millions of dollars and the years of manipulation came crashing down around him. Nav was arrested, and the man who once controlled markets with a few keystrokes was now at the mercy of the law.
As if irony had more to serve, Nav, despite earning over $40 million from his schemes, couldn’t even afford to post bail. His financial planners—the same ones meant to secure his future—had spent all of his fortune on themselves. All that brilliance, and now he was broke. The man who had danced on the edge of the financial system’s rules had finally fallen off the cliff.
The lesson? Doing the wrong thing might feel rewarding in the short run. But sooner or later, the house of cards collapses, and when it does, it tends to take everything with it. Just ask Nav. He ended up serving prison time for it.
The Day a Bedroom Trader Shook Wall Street
